Open Devices and Slices: Evidence From Wi-Fi Equipment

Do Yoon Kim, Roberto Fontana and Shane Greenstein

No 34603, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The study examines the quasi-natural experiments provided by the staggered introduction of open drivers in the supply chains for routers. It is rare to observe components become open and measure whether openness generates a statistical impact on more products and innovative products. This study collects novel data on all routers and subcomponents introduced between 2000 and 2018, characterizing each firm's position in a supply chain as either an upstream component provider or a downstream router assembler. Following prior literature, openness influences a firm's ability to negotiate with current and potential partners, which is labeled as autonomy. Evidence suggests that openness enhances supplier autonomy, increases the introduction of new products, and leads to a greater number of products located closer to the technical frontier. These estimates suggest that openness increased product introductions by enlarging the options available to component suppliers. The largest component suppliers benefited from greater sales, and no evidence indicates that openness aided entrants, small firms, or assemblers.

JEL-codes: L23 L63 O36 (search for similar items in EconPapers)
Date: 2025-12
Note: IO PR
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