Turbulence in High Growth and Declining Industries

Rui Baptista () and Murat Karaoez
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Murat Karaoez: IN+, Instituto Superior Tecnico, Technical University of Lisbon; IIBF, Department of Economics, Sueleyman Demirel University, Isparta, Turkey
Authors registered in the RePEc Author Service: Murat Karaöz ()

No 2007-043, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: We examine turbulence over the product life cycle using the lowest possible level of industry aggregation, allowing for the use of panel data to study the evolution of single product markets. We find that replacement of exiting firms by subsequent entry 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 product life cycles progress, trial-and-error entry subsides, and turbulence decreases.

Keywords: Entry; Exit; Selection; Product life cycle; Replacement; Displacement (search for similar items in EconPapers)
JEL-codes: L11 (search for similar items in EconPapers)
Date: 2007-07-31
New Economics Papers: this item is included in nep-com, nep-cse, nep-ent and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:jrp:jrpwrp:2007-043

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