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Rivalry, strategic groups and firm profitability
Author(s) -
Cool Karel,
Dierickx Ingemar
Publication year - 1993
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.4250140106
Subject(s) - rivalry , profitability index , business , industrial organization , marketing , economics , microeconomics , finance
An analysis of the U.S. pharmaceutical industry during the period 1963–82 finds that a substantial decline in industry profitability is not explained by changes in the number and size distribution of firms, in segment interdependence and in strategic distance. In contrast, declining industry profitability is strongly associated with increasing rivalry. This increasing rivalry is associated with changes in strategic group structure and a concomitant shift from within group rivalry to between group rivalry.