New entrants to a market tend to be superior to incumbents in originating radical innovations. We provide a new explanation for this phenomenon, based on markets for technology. It applies in industries where successful entrepreneurial firms, or their technologies, are acquired by incumbents...

Innovation in high technology industries poses considerable challenges, frequently forcing firms to consider using acquisitions as a means of sourcing technology. This paper investigates such behaviour in a major high technology sector, namely the semiconductor industry. The paper focuses on...