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Understanding the Silicon Valley Phenomena

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  • Masahiko Aoki
  • Hirokazu Takizawa

Abstract

This paper analyzes the 'Silicon Valley model' as a novel economic institution in the domain of technological product system innovation such as computers. We focus on the information structural relationship as well as governance relationships between venture capitalists and a cluster of entrepreneurial firms. The informational conditions under which the Silicon Valley model is efficient are identified, leading to understanding the significance of standardization of interfaces, modularization and information encapsulation.

Suggested Citation

  • Masahiko Aoki & Hirokazu Takizawa, 2002. "Understanding the Silicon Valley Phenomena," WIDER Working Paper Series DP2002-11, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:dp2002-11
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