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The impact of competition on vertical integration: The role of technological niche width

Published on Mar 1, 2020in Business Strategy and The Environment
· DOI :10.1002/BSE.2371
Faisal Khurshid1
Estimated H-index: 1
(PolyU: Hong Kong Polytechnic University),
Woo-Yong Park4
Estimated H-index: 4
(PolyU: Hong Kong Polytechnic University),
Felix T.S. Chan63
Estimated H-index: 63
(PolyU: Hong Kong Polytechnic University)
Abstract
Despite there being numerous studies exploring the relationship between competition and vertical integration, the empirical findings regarding the nature of this relationship are still unclear. The current study suggests that technological niche width mediates the relationship between competition and vertical integration. It also suggests that technological niche width and vertical integration play a complementary role in enhancing firm performance. These arguments have found empirical support in the examination of the U.S. hybrid electric vehicle market from 2008 to 2016. In so doing, this study provides an opportunity to better understand the relationship between competition, vertical integration, and technological niche width. In addition, it explains how firms can effectively manage fierce competition and achieve the goal of superior performance through strategic decisions regarding vertical integration and technological niche width.
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