페이스북에 공유 트위터에 공유 구글플러스에 공유 카카오톡에 공유 네이버밴드에 공유
  Home > Research > His Best
Writer 관리자 Date 2022-05-03
Subject [Economics of Innovation & New Technology] A Schumpeterian Approach to Entry Bar
rier and Firm Profitability: Cycle Time of Technology
Contents Lee, Keun and Sunghoon Lee, 2022. A Schumpeterian Approach to Entry Barrier and Firm Profitability: Cycle Time of Technology, Economics of Innovation and New Technology, 2022. Available at https://doi.org/10.1080/10438599.2022.2067150

abstract

Entry barrier has long been considered as a major determinant of firm profitability. Although a less competitive market structure has been commonly known as an indicator of an entry barrier, pieces of past empirical evidence are mixed. Moreover, technological factors, such as R&D intensity, have also been considered. However, no satisfactory empirical analysis has been made, mostly due to the lack of a suitable proxy variable that can reflect the technological environment of a sector. This study addresses this problem by trying a new proxy variable, cycle time of technologies (CTT), and shows, using the US firm data, that firms in a sector with a long CTT tend to enjoy higher profitability and values than others. A long CTT of a sector presents a high entry barrier against any entrant because in such sectors, an existing stock of knowledge tends to be important for a longer period of time, making new innovation continuously rely on old knowledge owned by incumbents and protected by patent rights.

Keywords: entry barrier, profitability, cycle time of technologies, Tobin’s Q, market structure, CR4
Upload #1 accepted-Lee and Lee-CTT in EINT 2022.pdf (536,034 byte)