Abstract
Technological laggards are usually majority in most industries and together they produce more innovation than the technological leader, but the laggard's innovation behavior has rarely been studied. A theoretical model that combines the firm capability and competitive dynamics literature is built to examine a technological laggard's innovation behavior. Data from the flat panel display industry are used to study what determines by how much, if at all, a technological laggard advances towards the technology frontier. Empirical results suggest that a technological laggard with better organizational and technological capabilities are more likely to move forward and move to the technology frontier. Especially, a technological laggard with capabilities of competiting at the technology frontieris more likely to move to the technology frontier.
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