The Nature, Sources, and Consequences of Firm Differences in the Early History of the Semiconductor Industry

Abstract

Corporate strategy is centrally concerned with the characteristics of firms that condition performance. Related notions of firm capabilities, core competences, dynamic capabilities, and intangible assets have been invoked to help firms identify their unique, inimitable qualities and devise a business strategy to exploit them. Spurred by policy and theoretical concerns and access to establishment census data, economists have also examined intraindustry firm differences, focusing on profitability and behaviors such as entry, exit, innovation, and advertising. Economists have found firm behavior and performance to be quite heterogeneous, although robust findings have not yet emerged on the sources of the heterogeneity. The strategy literature is also voluble on the sources of within-industry differences in performance, but it too does not offer robust findings.