Technological change and industry structure: A case study of the petroleum industry

Abstract

This paper is a case study of the impact of an exogenous improvement of a process technology on the structure of the petroleum industry. The paper examines the role of three-dimensional seismology in bringing about the 1990s oil industry consolidation. This proposition is examined in the context of evolutionary economics and in a non-cooperative game theory, concluding with a reference to Steindl's theory of industry dynamics. The significance of this contribution lies chiefly in highlighting the fact that exogenous technological change can, under appropriate conditions, play a significant role in industry dynamics. This reference to the exogenous change in technology is a departure from the traditional consideration of endogenity of industry structure in relation to technological development and, therefore, a novelty. Secondly, the documentation of 3D seismology as a significant process technology of the petroleum industry is significant.Process technology, Seismology, Industry dynamics, Mergers,

Entrepreneurship, Technology and Change: A Review and Proposal for an Interpretative Framework

“…Along the establishment of a technological paradigm, the competition is more concentrated with process technologies and cost effectiveness. Voola (2006) provides an evocative example of the impact of technological change on industry dynamics, in the case of the petroleum industry structure, acting as exogenous shock.…”

Ethanol and oil firms

“…Technological change in oil firms has been studied through different lenses, although upstream activities such as exploration and production (Voola, 2006;Acha, 2002;Finch, 2002) have received greater attention than downstream ones (Chen, 2002;. Technological change is often measured by oil firms' investment in total R&D, or by their R&D intensity and patenting activity.…”