Abstract
Deregulation, an external stimulus, triggers industrial transformation. Increased entropy may cause fragmentation of existing industries in a sector, while systemic adaptation may lead to concentration of industries in one sector. The industrial organization perspective leads one to assume that because firms in an industry share a common technology or production function, their responses to external stimuli and likely outcomes are unlikely to differ qualitatively. However, from the resource-based view, one may make out a case for inter-firm differences in resources and capabilities, imprinting consistent patterns of outcome of increase in the market share of industry leaders. Exploring the transformation witnessed by the manufacturing industry in India, following the changes ushered in by the Exim policy (1997–2002), this article identifies distinct patterns that industry leaders have set for themselves. Capability, guerilla and complexity logic again posit different outcomes of firms’ efforts to sustain competitive advantages related to different assumptions of market conditions. The article seeks to discover the validity of this logic in the context under study.
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