Playing by the Rules: Institutional Foundations of Success and Failure in the Taiwanese Computer Industry

This paper examines the different growth trajectories of the personal computer, hard disc drive, and software sectors in Taiwan since the 1980s. Taking an institutionalist perspective, we emphasize the importance of institutionalized rules of the game in shaping economic behavior within social systems. We explain success and failure in the three sectors according to different degrees of fit between the rules of the Taiwanese national system of production and the rules of the respective technology systems. Implications for business and government policy are drawn out.