Imprinting and Inertia – Density Delay Revisited

Abstract

The study builds on previous research in the domain of organizational ecology and derives hypotheses about delayed effects of the competitive intensity at the time of founding of a new organization on mortality rates. It is argued that on the one hand, old incumbent organizations with more industry experience exert more competitive pressure than younger ones. On the other hand, a situation at founding where incumbents have to spread their competitive efforts among different entry cohorts should be favorable for new organizations. Data on four populations of motorcycle producers in Germany, the United Kingdom, the United States of America and Australia are used to test these predictions. Empirical results provide support for the hypotheses in the first three populations. Conflicting results for Australia might be explained with the special evolution of the industry there. As it is known, estimated effects of the density at founding in various populations usually can explain only part of the observed declines of the number of organizations after a peak (Carroll and Hannan, 2000). However, the implemented measures in this study yield lager effects than the estimated classical density delay effect alone in three of the populations. Hence, the study extends the existing theory helping to explain generally observable evolutionary patterns more fully. Furthermore, it provides important theoretical insights in the historical path-dependency of the evolution of industries and in firm survival.

Keywords: Organizational ecology, density delay, industrial evolution, firm survival, imprinting, inertia