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Centre for Employment Studies
Industry
Evolution – Modelling Dynamical Thomas Grebel * Abstract Although the long term development of industries has been on the research agenda of economics since the early 20th century (Schumpeter, Kuznets, Clark) this tradition of investigating the dynamics and cyclical behaviour of sectoral evolution has been more or less neglected since the late 1950’s. Within the so-called Structure-Conduct-Performance-Paradigm industrial economics restricted itself to the analysis of short-term equilibria (in a comparative static perspective). Not before the 1980s a new strand of literature focuses on the development of industries. Emphasizing the role of the technological environment, the exploitation of scale-economies etc., an increasing number of contributions stresses the cyclical nature of industry development (Utterback and Abernathy,1975, Gort and Klepper, 1982). A second strand of literature is approaching the phenomena of industry dynamics by focussing on the characteristics of technological knowledge and innovation processes (e.g. Yale-Survey). The developments going on on a sectoral level are the result of specific combinations of the appropriability conditions, the technological opportunities, cumulativeness and the nature of the underlying knowledge base (Malerba and Orsenigo, 1995). By combining a model of entrepreneurial entry into an industry (Grebel, Pyka, Hanusch, 2003) and a dynamic heterogeneous oligopoly (Cantner, Pyka, 1998) in this contribution a general model is developed, which allows the replication of different industry dynamics driven by innovation and competition. *
University of Augsburg
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