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Product Quality Selection and Firm Survival. Evidence from the British Automobile Industry, 1895-1970

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  • Yuanyuan Peng

    ()
    (Department of Economics, Florida International University)

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    Abstract

    This paper proposes an additional determininant of firm survival. Based on a detailed examination of firm survival in the British automobile industry between 1895 and 1970, we conclude that firm’s selection of submarket-defined by quality level-influenced survival. In contrast to findings for the US automobile industry, there is no evidence of first-mover advantage in the market as a whole. However, we do find evidence of first-mover advantage after conditioning on submarket choice.

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    File URL: http://casgroup.fiu.edu/pages/docs/2244/1275229926_06-01.pdf
    File Function: First version, 2006
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    Bibliographic Info

    Paper provided by Florida International University, Department of Economics in its series Working Papers with number 0601.

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    Length: 33 pages
    Date of creation: Jan 2006
    Date of revision:
    Handle: RePEc:fiu:wpaper:0601

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    Web page: http://casgroup.fiu.edu/Economics/
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    Keywords: firm survival; product differentiation; submarket; product quality;

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    1. Uwe Cantner & Kristina Dreßler & Jens J. Krüger, 2004. "Firm Survival in the German Automobile Industry," Jenaer Schriften zur Wirtschaftswissenschaft, Friedrich-Schiller-Universität Jena, Wirtschaftswissenschaftliche Fakultät 08/2004, Friedrich-Schiller-Universität Jena, Wirtschaftswissenschaftliche Fakultät.
    2. Ron A. Boschma & Rik Wenting, 2004. "The spatial evolution of the British automobile industry," Papers in Evolutionary Economic Geography (PEEG), Utrecht University, Section of Economic Geography 0504, Utrecht University, Section of Economic Geography, revised Aug 2004.
    3. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, American Economic Association, vol. 67(3), pages 297-308, June.
    4. Klepper, Steven, 2001. "Employee Startups in High-Tech Industries," Industrial and Corporate Change, Oxford University Press, vol. 10(3), pages 639-74, September.
    5. Steven Klepper, 2002. "The capabilities of new firms and the evolution of the US automobile industry," Industrial and Corporate Change, Oxford University Press, vol. 11(4), pages 645-666, August.
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