Title

Technological Activity And Survival Of Firms

Authors

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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