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Evolutionary analysis of the firm and internal selection

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Abstract

Evolutionary approaches of the firm devote a part of their analysis to firm behavior and to some processes acting inside the firm, however the internal workings of firms are, most of the time, not deeply analyzed. In this perspective, this paper attempts to investigate whether " we can drop internal selection in the evolutionary analysis of the firm ". In order to answer this question, we propose a micro-simulation model of internal selection where firms are engaged in production and R&D activities. They carry out two kinds of R&D and do not run any imitation process. Internal selection acts on R&D projects and we measure the impact of the selection mechanism on the firm's performances. The model generates persistent differences between firms according to their internal selection process.

Suggested Citation

  • Nadia Jacoby, 2005. "Evolutionary analysis of the firm and internal selection," Cahiers de la Maison des Sciences Economiques r05042, Université Panthéon-Sorbonne (Paris 1).
  • Handle: RePEc:mse:wpsorb:r05042
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    File URL: ftp://mse.univ-paris1.fr/pub/mse/cahiers2005/R05042.pdf
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    Keywords

    Innovation; internal selection; market dynamics; R&D; technological performance;

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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