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Technological Efficiency and Organizational Inertia: A Model of the Emergence of Disruption

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  • Christian Buchta

    (Vienna University of Economics and Business Administration)

  • David Meyer

    (Vienna University of Economics and Business Administration)

  • Alexander Pfister

    (Vienna University of Economics and Business Administration)

  • Andreas Mild

    (Vienna University of Economics and Business Administration)

  • Alfred Taudes

    (Vienna University of Economics and Business Administration)

Abstract

We study the influence of technological efficiency and organizational inertia on the emergence of competition when firms decide myopically. Using a multi-agent computer simulation model, we observe the competitive reaction of a former monopolist to the advent of a new competitor. While the entrant uses a new technology, the monopolist is free either to stick to his former technology or to switch to the new one. We find that—irrespective of details regarding the demand side—a change of industry leadership occurs only if the new (“disruptive”) technology is not too efficient and organizations are inert.

Suggested Citation

  • Christian Buchta & David Meyer & Alexander Pfister & Andreas Mild & Alfred Taudes, 2003. "Technological Efficiency and Organizational Inertia: A Model of the Emergence of Disruption," Computational and Mathematical Organization Theory, Springer, vol. 9(2), pages 127-146, July.
    • Handle: RePEc:spr:comaot:v:9:y:2003:i:2:d:10.1023_b:cmot.0000022752.54325.37
    DOI: 10.1023/B:CMOT.0000022752.54325.37
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    References listed on IDEAS

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    1. Maksim Tsvetovat & Kathleen M. Carley, 2002. "Emergent Specializations in a Commodity Market: A Multi-Agent Model—Graduate Student Best Paper Award, CASOS 2001 Conference," Computational and Mathematical Organization Theory, Springer, vol. 8(3), pages 221-234, October.
    2. Klepper, Steven & Simons, Kenneth L, 1997. "Technological Extinctions of Industrial Firms: An Inquiry into Their Nature and Causes," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 6(2), pages 379-460, March.
    3. Malerba, Franco, et al, 1999. "'History-Friendly' Models of Industry Evolution: The Computer Industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 8(1), pages 3-40, March.
    4. Christensen, Clayton M., 1993. "The Rigid Disk Drive Industry: A History of Commercial and Technological Turbulence," Business History Review, Cambridge University Press, vol. 67(4), pages 531-588, January.
    5. Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, number 9780195102680.
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    Cited by:

    1. Lili Wang & Bin Hu & Yihang Feng & Yanting Duan & Wuyi Zhang, 2022. "Food supply network disruption and mitigation: an integrated perspective of traceability technology and network structure," Computational and Mathematical Organization Theory, Springer, vol. 28(4), pages 352-389, December.
    2. Elmar Kiesling & Markus Günther & Christian Stummer & Lea Wakolbinger, 2012. "Agent-based simulation of innovation diffusion: a review," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 20(2), pages 183-230, June.

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