Which Factor Dominates the Industry Evolution? A Synergy Analysis Based on China's ICT Industry

Industry evolution is caused by various reasons, among which technology progress has been approved to drive industry development, but with the new trend of industry convergence, inter-industry convergence also plays an increasingly important role. Contrasting to the previous studies, this paper plans to explore the industry synergetic evolution mechanism based on industry convergence and technology progress. We use self-organization method and Haken Model to establish synergetic evolution equations, and select technology progress and industry convergence as the key variables of industry evolution system. Besides, patent licensing data of China's listed ICT companies are collected to measure industry convergence rate, and DEA Malmquist index method is applied to calculate technology progress level. In the empirical analysis, simultaneous equation estimation method is adopted to investigate the synergetic industry evolution process. Our main findings are that (1) technology progress is an order parameter, which dominates industry system evolution. Moreover, industry convergence is a control parameter, which is influenced by technology progress; (2) Development of technology progress is the core factor for causing evolution of industry system, and industry convergence is the outcome of technology progress; (3) Especially, it is important that the dominated role of technology progress will be sustained, even though in the environment of convergence, and so companies also need to focus on self-innovation rather than only to adapt to the new industry evolution trend.