Journal of East China Normal University(Natural Science) ›› 2020, Vol. 2020 ›› Issue (6): 99-104.doi: 10.3969/j.issn.1000-5641.202021002

• Computer Science • Previous Articles     Next Articles

The adoption process for disruptive innovation: A theoretical analysis

WANG Ye, QU Linchi   

  1. School of Economics and Management, Shanghai Maritime University, Shanghai 201306, China
  • Received:2020-01-06 Published:2020-12-01

Abstract: Looking back on history, we observe that many industries generate disruptive innovations intermittently. It is worth noting that those who adopt new technologies for commercialization are usually not the incumbent leading companies with the strongest technical and financial strength, but rather companies that are established later in time, who operate on a smaller scale and with less technical strength. This article explains this phenomenon based on a two-stage game model. The advantages of incumbent companies in traditional technologies often become obstacles in their switch to innovative technologies. Companies established later in time can leverage the late-comer advantage to strategically reduce profits of new technology products, thereby blocking incumbent enterprises from the new product market.

Key words: disruptive innovation, two-stage game, switching cost, late-comer advantage

CLC Number: