Coevolution of Firm Capabilities and Industry Competition

Marc Huygens, Charles Baden-Fuller, Frans Van Den Bosch and Henk Volberda

ERIM Report Series Research in Management from Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam

Abstract: This paper proposes that rival firms not only search for new capabilities within their organization, but also for those that rest in their competitive environment. An integrated analysis of these search processes at both firm and industry levels of analysis shows how their interaction makes industries and firms coevolve over time. To contribute to an enhanced understanding of the concept of coevolution, a dynamic and integrative framework crossing meso and micro levels of analysis is constructed. This framework is applied to a longitudinal study of the music industry with a time-span of 120 years. The first part, a historical study, covers the period 1877 - 1990. The second part, a multiple-case study, covers the period 1990 - 1997. We conclude that search behavior drives coevolution through competitive dynamics among new entrants and incumbent firms and manifests itself in the simultaneous emergence of new business models and new organizational forms.

Keywords: coevolution; competitive regime; longitudinal research; multilevel research; music industry (search for similar items in EconPapers)
JEL-codes: L20 L22 M (search for similar items in EconPapers)
Date: 2001-11-02
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ems:eureri:126

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