5 years ago

Technological Extinctions of Industrial Firms: An Inquiry into their ...

Technological Extinctions of Industrial Firms: An Inquiry into their ...

48 firms, entry, and

48 firms, entry, and exit. The data are compiled from annual issues of Thomas’ Register and Synthetic Organic Chemicals, with wartime information from a FTC [1958] report and from Elder [1970]. After the entry of the wartime producers, 21 new manufacturers entered from 1947 to 1955. Thereafter, entry fell to an average of only 0.3 firms per year during the years 1956-1982. In the 1980s, entry increased again as entirely new semisynthetic penicillins were developed. The number of firms reached a peak of 29 firms in 1952-1954; hence we date the shakeout as beginning in 1954. The number of firms continued to fall for three decades, reaching a low of five firms in 1991. The companies most centrally involved in the wartime push for penicillin production were "the Big Three," Merck, Squibb, and Pfizer. All three began early experiments with penicillin production even before the British researcher Howard W. Florey arrived in the U.S. to encourage a penicillin program (Sheehan [1982, p. 69]). Other important wartime producers included Commercial Solvents, Cutter, Lilly, and Wyeth. Many more pharmaceutical firms asked to join the wartime penicillin program but were denied entry. 43 While additional firms entered the industry shortly after wartime restrictions were removed, these firms remained relatively obscure. Around 1958, Bristol, which had helped in the synthesis of penicillin by MIT Professor John C. Sheehan, and the British company Beecham Laboratories led in the development of new "semisynthetic" types of penicillins. These varieties of the drug were patented and tightly controlled, yielding lucrative new markets for their developers. The value of newer forms of penicillin can be seen from Table 14, which reports market shares of dollar sales for leading penicillin producers in 1960 and 1973 (comparable data were not available for earlier years). The two leading producers in 1960, Lilly and Wyeth, were the developers of what became their two most profitable forms of penicillin, penicillin V and benzathine penicillin (FTC [1958, pp. 3, 25], Schwartzman [1976, pp. 124-127]). By 1973 Bristol had become the number one U.S. producer, capitalizing on its prowess in the new 43 Applications from Hoffman-LaRoche and CIBA were turned down in 1943 because of concerns related to their foreign ownership and management (Sheehan [1982, p. 57]). Other firms were rejected because they were unwilling to promise a substantial enough contribution to the penicillin program, or to avoid wasteful overbuilding. In all, Elder [1970, p. 10] stated that over one hundred firms were discouraged from submitting penicillin production projects to the War Production Board.

49 semisynthetic penicillins to increase its market share from 8% in 1960 to 22.6% in 1973. In terms of the theories, the pattern of entry is again consistent with all three theories, with entry falling off sharply after the start of the shakeout. Penicillin is the only one of the products, though, in which there was modest rise in entry after many years of negligible entry. None of the theories predicts such a rise. The number of firms declined steadily after the start of the shakeout, as predicted only by the increasing returns theory. Also consistent with the theory, the earliest firms to exit the industry were all relatively small antibiotics producers (FTC [1958, p. 82]). In contrast to the other products, especially autos and tires, there was apparently considerable flux in the market shares of the leading firms after the shakeout had proceeded for a number of years. This is not consistent with the increasing returns theory, and is not predicted by the other theories. 6.2. Product Innovation To analyze product innovation in penicillin, we developed a list of new forms of penicillin, the innovator and date of innovation where available, and for each form the years it was produced by each producer. The producers of each form of penicillin and the years of production are compiled from annual editions of Synthetic Organic Chemicals (SOC). 44 The identity of the innovating firm and the date of innovation are drawn from the report of the FTC [1958] and Achilladelis [1993] for forms of penicillin that they discussed. Table 15 presents the list of innovations, with asterisks indicating innovating firms and daggers indicating major innovations according to Achilladelis. The trend over time in the rate of penicillin product innovation can be seen from the table. After penicillin was first developed, only 1 major and 1 minor new form were developed in the sixteen years 1943-1958. Thereafter the number of innovations jumped to 3 major and 8 minor new forms in the 16 year period 1959-1974, and 3 major and 5 minor new forms during the 16 year period 1975-1990. This pattern is consistent 44 SOC does not reflect some of the smaller firms listed in Thomas’ Register. The FTC [1958] report, however, provides another listing of producers by type of penicillin for the years 1950 and 1956 which basically accords with the listing from SOC, suggesting it is doubtful that many, if any, of the firms excluded from SOC produced the more innovative forms of penicillin.

Post-Recession Technology Growth Firms The
Production technology for the LED Industry
Industrial Technologies
Marine Technology Industry - Faculty
1 - Industrial Technologies
0 - Industrial Technologies
Solar Technology - Watts Industries
Threshold Firms - Backing Canada's Winners - ArtSites
The Technology Company - INDUSTRIAL EQUIPMENT
ITT Control Technologies Industrial Products Brochure - Neo-Dyn
Industrial Technology - Mohave Community College
View advert - Industrial Technology Magazine
NOVA Technology Cycloaliphatic THE ... - Cooper Industries
ENG - Industrial Technology Systems, sro
Building Technologies - Industry UK - Siemens
Technology Parks and Technological Transfer in Andhra Pradesh ...
OECD Science OECD Science, Technology and Industry Outlook 2012
INDUSTRIAL HOSE AL HOSE - Delafield Fluid Technologies
U.S. Department of Energy – Industrial Technologies Program
Linear axis HL WEISS - Industrial Technologies
drives, motors & controls - Industrial Technology Magazine
Nikken Rotary Table Flyer - Industrial Technologies
Oceanic Institute - Clean Technology and Sustainable Industries ...
Delta Integrated Elevator Drive IED Series - Industrial Technologies
solid edge - Industrial Technology Systems, sro