Lieberman and Montgomery (1988,p. 41) define first-mover advantage as “the ability of pioneering firms to earn positive economic profits (i.e., profits in excess of the cost of capital).” In many industries and product-markets, on average, surviving first-movers or early entrants have been found to command a higher market share than surviving non-innovative late entrants (e.g., Lambkin 1988; Shankar et al. 1998; Urban et al. 1986). This observed pattern of relationship suggests that under certain organizational and environmental conditions, early entry can be a normative strategy conducive to superior marketplace and financial performance, due to the competitive cost and differentiation advantages associated with being a first-mover ( Lieberman and Montgomery 1988; Kerin et al. 1992). However, extant research on the relationship between order of entry and survival is equivocal. While some studies report a higher failure ( lower survival ) rate for first-movers ( Lilien and Yoon 1990; Golder and Tellis 1993), others report a higher survival rate for first-movers ( Mascarenhas 1992; Robinson and Min 2002) . Research focusing on situational contexts in which the survival risks are higher vs lower for first-movers provide additional insights into this issue ( see, e.g., Srinivasan et al. 2004; Min et al. 2006; Suarez and Lanzolla 2007). Some studies highlight advantages for early followers over first-movers under specific conditions (e.g., Lilien and Yoon 1990; Shankar et al. 1999). A number of published works on first-mover advantage in the genre of integrative review articles ( Lieberman and Montgomery 1988; Kerin et al. 1992), meta-analysis ( Szymanski et al. 1995), and empirical generalizations ( Kalyanaram et al. 1995) also provide valuable insights.
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