Trade-offs to using standardized tools: Innovation enablers or creativity constraints?
Strategic Management Journal (Open access at the journal website: https://doi.org/10.1002/smj.3457)
Posted: 22 Apr 2019 Last revised: 27 Dec 2022
Date Written: September 28, 2022
Abstract
In platform ecosystems, the creation of new products is often based on standardized development tools. Complementors often have a choice between either using these tools or creating the functionality themselves. In this paper, we study how the use of standardized development tools is related to the type of products created. By using data on the use of middleware (e.g., game engines) in the console video game market, we show that the use of development tools is associated with products that are less novel but with higher sales on average. We exploit a policy change that affected the ability of U.S.-based developers to hire foreign workers as an instrument for the use of development tools and find further support for these patterns.
Keywords: enabling technologies, modularity, platform ecosystem, platform governance, standardized development tools
JEL Classification: L15, L82, L86, O32
Suggested Citation: Suggested Citation
Milan Miric (Contact Author)
University of Southern California, Marshall School of Business ( email )
Marshall School of Business
BRI 401, 3670 Trousdale Parkway
Los Angeles, CA 90089
United States