Showing papers by "David J. Teece published in 1986"
Posted Content•
TL;DR: In this article, the authors establish a framework within which to analyze the profit distribution of innovations and determine the reasons why imitators may outperform innovators, and propose an appropriate control structure which the innovator ought to establish over critical, complementary assets.
Abstract: Establishes a framework within which to analyze the profit distribution of innovations and determines the reasons why imitators may outperform innovators. First, the three fundamental building blocks necessary to explain the distribution of innovations are discussed: the appropriability regime, complementary assets, and the dominant design paradigm. Next, the imitation process and the distribution of profits between innovator and follower are examined by relating these three concepts. Then, an appropriate control structure is proposed which the innovator ought to establish over critical, complementary assets. Finally, implications for R&D strategy, industry structure and trade policies are discussed. Analysis suggests that firm boundaries are an important strategic variable for firms that innovate. Also, innovator ownership of complementary assets can be the deciding factor in whether innovators or imitators outperform one another in garnering the most economic return from innovation. (SFL)
673 citations
TL;DR: In this article, transactions cost analysis is applied to the multinational enterprise in order to ascertain its distinctive properties as a mode of economic organization and to identify just when and where contractual alternatives to a multinational firm are likely to be viable, depending upon the nature of the technology, the regime of appropriability within which the firm operates and the characteristics of the markets in question.
Abstract: This paper applies transactions cost principles to the multinational enterprise in order to ascertain its distinctive properties as a mode of economic organization. The analysis helps identify just when and where contractual alternatives to the multinational firm are likely to be viable. This turns out to depend upon the nature of the technology, the regime of appropriability within which the firm operates, and the characteristics of the markets in question. Transactions cost analysis is also extended to the multinational enterprise-host country relationship. Implications for management and public policy are derived.
627 citations
TL;DR: The authors assesses the competition faced by oil pipelines and uses a new procedure and new data to test whether oil pipeline markets are competitive or monopolistic, under standard definitions of the relevant market(s) in which pipelines operate.
Abstract: This paper assesses the competition faced by oil pipelines. It also uses a new procedure and new data to test whether oil pipeline markets are competitive or monopolistic, under standard definitions. The key innovation of the paper is a new approach to the definition of the relevant market(s) in which oil pipelines operate. While recognizing that pipeline monopsony also could be a problem under certain conditions, the paper argues that these conditions are unlikely to arise and that if they do, it is unclear whether pipeline owners would be in a position to exploit them. The study offers new evidence to fuel the 80-year-old debate over pipeline rates and regulation.
2 citations