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Coevolution of Industries and Academic Disciplines

Coevolution of Industries and Academic Disciplines. Wharton, March 26, 2004. Johann Peter Murmann. General Hypothesis about Coevolution of National Industries & National Academic Disciplines The Research Site: Synthetic Dye Industry 1850-1914 What are Evolutionary Explanations

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Coevolution of Industries and Academic Disciplines

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  1. Coevolution ofIndustries and Academic Disciplines Wharton, March 26, 2004 Johann Peter Murmann

  2. General Hypothesis about Coevolution of National Industries & National Academic Disciplines • The Research Site: Synthetic Dye Industry 1850-1914 • What are Evolutionary Explanations • Previous Research and my Definition of Coevolution • Analysis of Coevolution of Synthetic Dye Industry & Academic Chemistry • Formulating a General Hypothesis from the Study • Contributions of the Paper & Future Research Road Map for Talk

  3. Typology of Academic-Industrial (A-I) Complexes Strong Industrial Sector Weak Weak Strong Academic Discipline Academic Laggard Power-Union Quadrant I Quadrant II Quadrant III Quadrant IV Union of the Weak Industrial Laggard

  4. Explanation of Symbols Academic discipline in particular country Industrial sector in particular country Academic-industrial complexes 1 2 3 … n

  5. Co-Evolution Processes at the National Level Time 1 Strong Industrial Sector Weak Weak Strong Academic Discipline

  6. Co-Evolution Processes at the National Level Time 2 Strong Industrial Sector Weak Weak Strong Academic Discipline

  7. Co-Evolution Processes at the National Level Time 3 Strong Industrial Sector Weak Weak Strong Academic Discipline

  8. Co-Evolution Processes at the National Level Time 4 Strong Industrial Sector Weak Weak Strong Academic Discipline

  9. Coevolutionary analysis requires two steps • Need to show that both partners in the coevolutionary relationship can be conceptualized as populations that change through variation, selection, retention (VSR) processes. • Need to specify bi-directional causal mechanisms that link the fate of the two populations • a. Exchange of personnel (EP) • b. Commercial ties (CT) • c. Lobbying for each other (L) Key Argument of Current Paper

  10. 2. The Site: Synthetic Dye Industry

  11. British and French Firms are the Leaders in Dye Industry in 1862 Market Share U. S. Germany Switzerland France Other Britain

  12. German Firms are Leaders in the Dye Industry in 1873 Market Share U. S. Germany Switzerland France Other Britain

  13. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% German Firms Dominate World Dye Industry in 1913 Market Share U. S. Germany Switzerland France Other Britain

  14. Data & Methods • Inductive Case Method (Eisenhardt, 1989) • Comparative historical analysis (Stinchcombe, 1978, Tilly, 1984; Ragin, 1987, Chandler 1990) • Repeated dialogue between ideas and evidence to develop new theories • Constructed database of virtually all synthetic dye firms in the world from 1857 to 1914 379 distinct dye firms (648 firms in database) • Studied industry and firm histories 6 case studies of a winner and loser in Britain, Germany and the U.S. • Collected data on academic disciplines in five different countries. • Studied biographies of leading industrialists and chemists

  15. 2. Background: Requirements for an Evolutionary Explanation of Industrial Change • Populations evolve not individuals • Sources of Variation (Variation) • Innovations • Process of Transformation (Selection) • Differential adoption and survival of routines in a population of entities • Units of Transmission (Retention) • Routines (standard operating procedures) • Mechanism of Transmission (Retention) • “Social intercourse,” i.e imitation

  16. Industrial Change: A Selection Process Population of Firms at Time 1 Selection Filter e.g. Profits Firm with Formal R&D Standard Firm Firm with Informal R&D Population of Firms at Time 2

  17. Change in Cognitive Organization of Universities Selection Filter Humanities Law Organic Chemistry Medicine Population of Ideas at T2 Population of Ideas at T1

  18. Evolutionary Change in Individual Discipline Organic Chemistry Inorganic Chemistry Population of Ideas at T2 Population of Ideas at T1 Selection Filter

  19. An Adaptation Process of Change Population of Firms at Time 1 Heroic Managers Firm with Formal R&D Standard Firm Firm with Informal R&D Population of Firms at Time 2

  20. The Firm as Viewed as an Evolving Population Firm at Time 1 Selection Filter e.g. Profits Character 3 Character 1 Character 2 Firm at Time 2

  21. 4. Previous Research on “Coevolution” Coriat and Dosi, 1998 McKelvey, 1997 Haveman and Rao, 1997 Barnett and Hansen, 1996 Levinthal and Myatt, 1995 March, 1994 Baum and Singh, 1994 Rosenkopf and Tushman, 1994 Yates, 1993 Dosi & Kogut, 1993 Kieser, 1989 Burgelman, 2002 Repenning & Sterman 2002 Eisenhardt and Galunic, 2000 McKelvey, 1999 Lewin and Volberda, 1999 Baum and McKelvey, 1999 Lewin et al., 1999 Van De Ven and Grazman, 1999 Rosenkopf and Nerkar, 1999 Koza and Lewin, 1998

  22. Diverse meanings “Coevolution” • Two things are developing in parallel • Technology and Organization • micro and macro level (firm evolves and industry evolves) • One thing that develops has a causal impact on a second thing that develops • Environment and organizational forms • Two things mutually influence each other’s development • Two (or more) business units (Eisenhardt and Galunic, 2000) • Each thing changes to a large extent through a selection process • Mutualism (not only competition) is important coevolutionary mechanism

  23. My Definition of Coevolution Two evolving populations coevolve if and only if they have a significant causal impact on each other’s ability to persist

  24. 5. Analysis of Coevolution of Synthetic Dye Industry & Academic Chemistry Step 1: Need to identify two populations that change through VSR processes Population 1: firms (differing in blueprints for action) Population 2: scientific ideas (differing in their content)

  25. Specific Evolutionary Mechanisms

  26. Evidence for evolutionary change in the two populations • Synthetic Dye Industry from 1857 to 1914 • Percentage of firms with local formal R&D laboratory • Ownership structure of firms • Percentage of firms with global sales force • (Global market share of firms from particular country) • Organic Chemistry • Share of Organic Chemistry in the Literature of Chemistry • (Global share of organic chemistry literature by researchers from particular country)

  27. Frequency of Important Firm Traits 1 % of Firms with Local Formal R&D Department

  28. % of Firms that are either Single individual firms, Family firms & Partnerships Frequency of Important Firm Traits 2

  29. Industry Demography 1857-1914

  30. Frequency of Organic Chemistry Ideas 1857-1914

  31. Coevolutionary Analysis Step 2: • Identify bi-directional causal • mechanisms linking • population of industrial firms (representing • Industries) and • population of scientific ideas (representing • disciplines) • Exchange of personnel (EP) • Commercial ties (CT) • Lobbying for each other (L)

  32. Causal Relationships Connecting the two Populations: 1

  33. Causal Relationships Connecting the two Populations: 2

  34. Causal Relationships Connecting the two Populations: 3

  35. Causal Relationships between the Coevolving Populations EP,CT EP,CT, L EP

  36. British and French Firms are the Leaders in Dye Industry in 1862 Market Share U. S. Germany Switzerland France Other Britain

  37. German Firms are Leaders in the Dye Industry in 1873 Market Share U. S. Germany Switzerland France Other Britain

  38. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% German Firms Dominate World Dye Industry in 1913 Market Share U. S. Germany Switzerland France Other Britain

  39. German Share of Aromatic Organic Chemistry Publications cited in France

  40. Global Share of Organic Chemistry Publications

  41. 6. Generalizing the Argument • National Industries and National Academic Disciplines coevolve • This has profound implications for what industry and what academic discipline in a particular country will be strong in

  42. Typology of Academic-Industrial (A-I) Complexes Strong Industrial Sector Weak Weak Strong Academic Discipline Academic Laggard Power-Union Quadrant I Quadrant II Quadrant III Quadrant IV Union of the Weak Industrial Laggard

  43. Academic-industrial complexes Britain France Germany Switzerland United States Explanation of Symbols Used in Presentation Academic discipline in particular country Industrial sector in particular country

  44. Organic Chemistry in Different Countries 1850 Strong Industrial Sector Weak Weak Strong Academic Discipline No synthetic dye industry existed before 1857 Britain France Germany Switzerland United States

  45. Co-Evolution in the Synthetic Dye Industry 1860 Strong Industrial Sector Weak Weak Strong Academic Discipline Britain France Germany Switzerland United States

  46. Co-Evolution in the Synthetic Dye Industry 1870 Strong Industrial Sector Weak Weak Strong Academic Discipline Britain France Germany Switzerland United States

  47. Co-Evolution in the Synthetic Dye Industry 1913 Strong Industrial Sector Weak Weak Strong Academic Discipline Britain France Germany Switzerland United States

  48. Co-Evolution Processes at the National Level Time 1 Strong Industrial Sector Weak Weak Strong Academic Discipline

  49. Co-Evolution Processes at the National Level Time 2 Strong Industrial Sector Weak Weak Strong Academic Discipline

  50. Co-Evolution Processes at the National Level Time 3 Strong Industrial Sector Weak Weak Strong Academic Discipline

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