Disagreements, Spinoffs, and the Evolution of Detroit as the Capital of the U.S. Automobile Industry

Steven Klepper

Management Science, 2007, vol. 53, issue 4, 616-631

Abstract: The agglomeration of the automobile industry around Detroit, Michigan is explained using a theory in which disagreements lead employees of incumbent firms to found spinoffs in the same industry. Predictions of the theory concerning entry and firm survival are tested using data on the origin, location, and years of production of every entrant into the industry from 1895 to 1966. The geographic concentration of the industry is attributed to four early successful entrants and the many successful spinoffs they spawned in the Detroit area and not to conventional agglomeration economies benefiting co-located firms, as featured in modern theories of agglomeration. Implications of the findings regarding firm strategy are discussed.

Keywords: economics; econometrics; organizational studies; econometric dynamics (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (207)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.1060.0683 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:53:y:2007:i:4:p:616-631

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().