Innovations and market shares

Pomroy, Richard Michael (1991) Innovations and market shares. University of Southampton, Doctoral Thesis.

Abstract

Innovations are an important source of changes in firms' competitive position. In the past little work has been done on the effect innovations have on industry structure owing to insufficient information on innovations. However, some work was done using R and D expenditure. Likewise most studies of industry structure looked at concentration rather than firms' shares, owing to lack of data on market shares. In this thesis information on innovations and market shares is used to study changes in industry structure. Work done jointly with Paul Geroski using panel data for U.K. manufacturing industries shows that innovations are deconcentrating. This result supports a hypothesis of Blair (1972) which was based on case studies of U.S.A. industries. The work also suggests that concentration reacts fairly quickly to shocks, this is contrary to previous work in the literature. The effect of innovations on market shares is investigated using both case studies and regressions. This shows that innovations increase the share of innovating firm. Another aspect of changing industry structure is market share mobility. The axiomatic approach is used to suggest four properties that mobility indices should satisfy. It is shown that two of the indices in the literature satisfy these properties. These mobility indices are used to study mobility in the four industries in the Instrument Engineering Order. It is shown that small firms' share of mobility is generally greater than their market share for the industries studied. Work is also done on the robustness of concentraton indices when data is missing.

This record has no associated files available for download.

Contributors

Download statistics