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Complexity, Critical Mass and Industry Formation: A Comparison of Selected Industries

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  • Jeffrey Funk

Abstract

This paper uses a typology of industries to summarize and contrast the challenges involved with industry formation and to examine why specific industries were formed in some countries before other ones. The formation of most new industries depends on the introduction of products that provide a superior “value proposition” to some set of users where their introduction requires new R&D-related capabilities in firms. However, industries whose products require a critical mass of users or complementary products for growth to continue and ones that involve complex systems face additional challenges.

Suggested Citation

  • Jeffrey Funk, 2010. "Complexity, Critical Mass and Industry Formation: A Comparison of Selected Industries," Industry and Innovation, Taylor & Francis Journals, vol. 17(5), pages 511-530.
  • Handle: RePEc:taf:indinn:v:17:y:2010:i:5:p:511-530 DOI: 10.1080/13662716.2010.510001
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    References listed on IDEAS

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    1. Pontus Braunerhjelm, 2008. "Specialization of Regions and Universities: The New Versus the Old," Industry and Innovation, Taylor & Francis Journals, vol. 15(3), pages 253-275.
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    7. Høgni Kalsø Hansen & Thomas Niedomysl, 2009. "Migration of the creative class: evidence from Sweden," Journal of Economic Geography, Oxford University Press, vol. 9(2), pages 191-206, March.
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    9. Partridge, Mark D. & Rickman, Dan S., 1999. "Which comes first, jobs or people? An analysis of the recent stylized facts," Economics Letters, Elsevier, vol. 64(1), pages 117-123, July.
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    Cited by:

    1. Bergek, Anna & Berggren, Christian & Magnusson, Thomas & Hobday, Michael, 2013. "Technological discontinuities and the challenge for incumbent firms: Destruction, disruption or creative accumulation?," Research Policy, Elsevier, vol. 42(6), pages 1210-1224.

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