Research Seminars

“External Entry and the Evolution of Industry Clusters: A Study of the Biotechnology Industry in Canada"

Speaker: Dean HENNESSY
Rotman School of Management, University of Toronto

14 February 2005 - From 16h00 to 17h30

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While the Canadian newspaper industry is

mature and stable, in terms of the total number of papers, it has continued to be dynamic. We examine the risk of exit in the

Canadian daily newspaper industry between 1972 and 1992 as one aspect of industry dynamics. We add to the growing literature

in spatial ecology by differentiating between large regional papers and small local papers, and show how competition in the

centre of large regional markets has two primary effects:
(1) it increases the risk of exit in the center; and, (2) it

leads to geographic differentiation away from the center which exerts competitive pressures in nearby local markets. For

papers in small local markets, such competitive pressures diminish with distance from regional markets, and are further

mitigated by firm specific advantages, especially those related to competitive strength and scale.
Geographic

differentiation for regional papers is, however, a two-edged sword: it relieves competitive pressures in the center, but

generates more in the periphery, up to a critical level, after which it declines.

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