Industry Evolution: New Technologies and New Firms
AbstractThis paper investigates the effects of employee mobility on industry evolution and technology diffusion by testing a dynamic industry equilibrium model introduced in Franco and Filson (1999). The model focuses on a particular type of employee mobility: researchers can leave existing firms and attempt to form new firms (spin-outs). The model has four testable results: First, spin-outs are an important source of entry. Second, spin-out founds come from firms with high know-how. Third, firms with high know-how are more likely to survive. Fourth, spin-outs whose parents have high know-how are more likely to survive. Using data from the rigid disk drive industry (1977-1997), we find support for the first three results and mixed support for the fourth.
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spin-off; industry dynamics; technological change; innovation; research and development;
Find related papers by JEL classification:
- L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
- L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
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