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The dynamics of interfirm networks along the industry life cycle: The case of the global video game industry, 1987--2007

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  • Pierre-Alexandre Balland
  • Mathijs De Vaan
  • Ron Boschma

Abstract

In this paper, we study the formation of network ties between firms along the life cycle of a creative industry. We focus on three drivers of network formation: i) network endogeneity which stresses a path-dependent change originating from previous network structures, ii) five forms of proximity (e.g. geographical proximity) which ascribe tie formation to the similarity of actors' attributes; and (iii) individual characteristics which refer to the heterogeneity in actors capabilities to exploit external knowledge. The paper employs a stochastic actor-oriented model to estimate the - changing - effects of these drivers on inter-firm network formation in the global video game industry from 1987 to 2007. Our findings indicate that the effects of the drivers of network formation change with the degree of maturity of the industry. To an increasing extent, video game firms tend to partner over shorter distances and with more cognitively similar firms as the industry evolves.
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Suggested Citation

  • Pierre-Alexandre Balland & Mathijs De Vaan & Ron Boschma, 2013. "The dynamics of interfirm networks along the industry life cycle: The case of the global video game industry, 1987--2007," Journal of Economic Geography, Oxford University Press, vol. 13(5), pages 741-765, September.
    • Handle: RePEc:oup:jecgeo:v:13:y:2013:i:5:p:741-765
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    File URL: http://hdl.handle.net/10.1093/jeg/lbs023
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    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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