Technological Activity And Survival Of Firms

    Authors

    R. Agarwal

    Comments

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    Abbreviated Journal Title

    Econ. Lett.

    Keywords

    technological activity; firm survival; hazard rates; evolution; product; markets; DIFFUSION; Economics

    Abstract

    The paper presents new evidence on the effect of technological activity on the post-entry performance of firms. By comparing firm survival across technical and non-technical products and over stages of differing technological activity, it attempts to resolve two seemingly contradictory hypotheses: that uncertainty inherent in high technological activity reduces the probability of survival and that technological activity increases the probability of entrant survival. The empirical results, in the context of the product life-cycle framework, show that entering firms enjoy a higher probability of survival in stages of high technological activity, and in products that are more technical in nature. However, the hazard function - the probability of failure conditional on age - is higher for technical products, reflecting the adverse effects of technical uncertainty and obsolescence of incumbent knowledge.

    Journal Title

    Economics Letters

    Volume

    52

    Issue/Number

    1

    Publication Date

    1-1-1996

    Document Type

    Article

    Language

    English

    First Page

    101

    Last Page

    108

    WOS Identifier

    WOS:A1996VH61200015

    ISSN

    0165-1765

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