First-mover advantages and path dependence

One of the empirical regularities of a product or industry's life cycle is that the one or two firms that eventually emerge as the industry leaders tend to be among the first to enter the industry. In this paper, I inquire into the nature of 'this first mover's advantage' that might account for the dramatic and persistent differences in performance across firms that have been observed. I identify four categories of first mover advantage related to demand and supply factors, and link these concepts to that of path dependence. (C) 1997 Elsevier Science B.V.