Entry by Spinoff in a High-tech Cluster

Not too long ago empirical research has centered on how abilities of new entering firms are essential for the development of industries over time. The overall performance of recent entrants definitely seems to be considerably affected by their pre-entry background. The general impression of the literature is that businesses founded by former employees of successful incumbents have demostrated larger propensities to outlive than other categories of new entrants. In our report, we make use of this method of study the emergence and growth in the last 30 years of a wireless telecommunications cluster around Aalborg in North Jutland, Denmark (NorCOM). The goal is to evaluate the prominent forces behind the growth of NorCOM using detailed information about the founding events and organizational background of the individual entrants in the cluster. We indicate that the technological successes of firms in the area have powered a spinoff process, which can account for the majority of the growth in number of firms and employment in the cluster….

Source: Copenhagen Business School

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