Latecomers’ path-creating catch-up strategy in ICT industry: The effect of market disparity and government dependence
Journal of Entrepreneurship in Emerging Economies
ISSN: 2053-4604
Article publication date: 16 January 2019
Issue publication date: 22 May 2019
Abstract
Purpose
This study aims to empirically examine the conditions for latecomers to successfully pursue path-creating catch-up strategies. In particular, the company is divided into two conditions: the external environment, which refers to the gap in the market share between the leaders and latecomers, and the internal capacities of the company, such as the company’s absorptive capacity, re-combinative capabilities and technological innovation leadership.
Design/methodology/approach
Because firms supported by the government tend to be conservative in their decision-making and technology development strategies, governmental assistance is likely to negatively affect path-creating catch-up strategies. This study surveyed small to medium enterprises in the Korea IT industry and analyzed the latecomers’ catch-up strategies from internal and external environment perspectives.
Findings
After ensuring its innovation capacity by developing of internal capacity, it turned out to lead to path-creative catch-up strategy and market disparity and government dependence moderates this relation. While market disparity has a positive moderation effect, government dependence showed a negative moderation effect.
Originality/value
The authors proposed and tested hypotheses of how a firm’s path-creative catch-up strategy is adopted and succeeds. Regarding the internal conditions, the authors statistically proved that absorptive capabilities, re-combinative capabilities and technology innovation leadership are important factors for a firm’s technology innovation capacity.
Keywords
Citation
Kim, D.B. and Park, M.J. (2019), "Latecomers’ path-creating catch-up strategy in ICT industry: The effect of market disparity and government dependence", Journal of Entrepreneurship in Emerging Economies, Vol. 11 No. 2, pp. 234-257. https://doi.org/10.1108/JEEE-06-2018-0056
Publisher
:Emerald Publishing Limited
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