Turbulence in growing and declining industries
SMALL BUSINESS ECONOMICS, vol.36, no.3, pp.249-270, 2011 (SSCI, Scopus)
- Publication Type: Article / Article
- Volume: 36 Issue: 3
- Publication Date: 2011
- Doi Number: 10.1007/s11187-009-9226-2
- Journal Name: SMALL BUSINESS ECONOMICS
- Journal Indexes: Social Sciences Citation Index (SSCI), Scopus
- Page Numbers: pp.249-270
- Keywords: Displacement, Entry, Entry mistakes, Exit, Industry life cycle, Selection, Replacement, Turbulence, MANUFACTURING-INDUSTRIES, UNITED-STATES, EXIT DECISIONS, SMALL FIRMS, LIFE-CYCLE, ENTRY, EVOLUTION, SURVIVAL, GROWTH, DETERMINANTS
- Akdeniz University Affiliated: No
Abstract
Turbulence over the industry life cycle is examined for the case of Portugal using the lowest possible level of industry aggregation, thus allowing for the use of panel data to study the evolution of product markets. Replacement of exiting firms by subsequent entrants plays a primary role in generating turbulence in high growth markets, while displacement of incumbents by recent entrants is the main selection force in declining markets. As the industry life cycle progresses, trial-and-error entry and entry mistakes decrease, and turbulence subsides.