Abstract
Taking a macro-structuralist viewpoint, this paper draws on the literature of institutionalism and technological evolution to examine the failure of Taiwan’s hard disk drive industry. Recent years have seen the acceptance of national institutions in determining industrial innovation and development. Many have focused on successful stories with an emphasis on the bright-side of institutions. However, given institutional rigidity, the potential for social conflicts and the evolutionary nature of organizational learning, a national system with deeply institutionalized principles may reject the prevailing technological regime. In other words, industry failure may be explained in terms of a failure of institutions. Using a method of qualitatively-based grounded, comparative case studies, the paper argues that Taiwan failed to grow hard disk drives because its society did not effectively co-evolve with the trajectory of the world-wide hard disk drive technology.