Losing my religion? Diversification into laser technology by German machine tool producers, 1975-2008

We investigate the strategic diversification into a new innovative industry by producers coming from an established industry. To this purpose, datasets on the long-term evolution of the firm populations in the German machine tool and laser industries are matched. Only a small number of diversifiers from machine tools into the laser industry are identified. These tended to be among the larger and more innovative machine tool producers. For early diversifiers, exit hazards from the industry of origin increase after diversification. We do not obtain robust evidence that diversification is pushed by agglomeration in the industry of origin or pulled by agglomeration in the target industry. Regional laser-related public

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