Strategy and Circumstance: The Response of American Firms to Japanese Competition in Semiconductors, 1980-1995

27 Pages Posted: 14 Feb 2000

See all articles by Richard N. Langlois

Richard N. Langlois

University of Connecticut

W. Edward Steinmueller

University of Sussex - Science and Technology Policy Research Unit (SPRU)

Date Written: December 1999

Abstract

The transistor was an American invention, and American firms led the world in semiconductor production and innovation for the first three decades of that industry's existence. In the 1980s, however, Japanese producers began to challenge American dominance. Shrill cries arose from the literature of public policy, warning that the American semiconductor industry would soon share the fate of the lamented American consumer electronics business. Few dissented from the implications: the only hope for salvation would be to adopt Japanese-style public policies and imitate the kinds of capabilities Japanese firms possessed.

But the predicted extinction never occurred. Instead, American firms surged back during the 1990s, and it now seems the Japanese who are embattled. This remarkable American turnaround has gone largely unremarked upon in the public policy literature. And even scholarship in strategic management, which thrives on stories of success instead of stories of failure, has been comparatively silent. Drawing on a more thorough economic history of the worldwide semiconductor industry (Langlois and Steinmueller 1999), this essay attempts to collect some of the lessons for strategy research of the American resurgence. We argue that, although some of the American response did consist in changing or augmenting capabilities, most of the renewed American success is in fact the result not of imitating superior Japanese capabilities but rather of taking good advantage of a set of capabilities developed in the heyday of American dominance. Serendipity played at least as important a role as did strategy.

JEL Classification: L1, L5, L6, N6

Suggested Citation

Langlois, Richard N. and Steinmueller, W. Edward, Strategy and Circumstance: The Response of American Firms to Japanese Competition in Semiconductors, 1980-1995 (December 1999). Available at SSRN: https://ssrn.com/abstract=204093 or http://dx.doi.org/10.2139/ssrn.204093

Richard N. Langlois (Contact Author)

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W. Edward Steinmueller

University of Sussex - Science and Technology Policy Research Unit (SPRU) ( email )

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