Defining Industrial Leadership

This volume contains studies of the evolution of seven industries, exploring the development of each in the United States, Japan, and Western Europe. The industries are machine tools, organic chemical products, pharmaceutical biotechnology, medical devices, computers, semiconductors, and software. Each industry study compares the development of these industries in the different countries and considers the factors that explain cross-national and cross-industry differences. Together, we hope that these studies will shed light on the sources of industrial leadership, a concept we discuss next.

The choice of these seven industries was motivated by our concern to cover an array of diverse industries in which technological innovation plays an important role. Several of these industries, such as semiconductors and computers, trace their birth to the opening of a major new technology in the postwar period. Technological advance in some of these industries, particularly organic chemical products and semiconductors, has had profound impacts on the products and processes of a wide range of downstream industries. In turn, the technology employed in some of these industries, such as machine tools and computers, has been powerfully influenced by upstream innovation.

At one time or another in the history of virtually all of these industries, firms located in one country or a small number of countries developed superior product or process technologies, ways of organizing production, or marketing strategies that gave them significant advantages over firms based in other countries.