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Competition and innovation: The tango of the market and technology in the competitive landscape
Author(s) -
Qian Lihong,
Wang I. Kim
Publication year - 2017
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.2861
Subject(s) - competition (biology) , industrial organization , sword , technology development , business , production (economics) , competitive advantage , market competition , economics , technology management , marketing , market economy , microeconomics , engineering , ecology , biology , mechanical engineering , manufacturing engineering
Technology innovation can be a double‐edged sword in helping a firm to address competitive pressures. We explore the relationships among market competition, technology competition, and firms' advancement to a higher generation of production technology. Though market competition drives technology advancement as firms attempt to escape competition and technology competition also drives technology advancement as firms try to stay in the technology race, concurrent high market and technology competition lead a firm to defer advancement. We find supportive evidence with data on global flat panel display makers. Our findings shed light on how competition interacts with a firm's technology advancement decision and, in general, a firm's technology strategy.