Technological Change and Industry Structure: A Case Study of the Petroleum Industry

This paper is a case study of the impact of an exogenous improvement of a process technology on the structure ofthe petroleum industry. The paper examines the role of three-dimensional seismology in bringing about the 1990s oilindustry consolidation. This proposition is examined in the context of evolutionary economics and in a non-cooperativegame theory, concluding with a reference to Steindl’s theory of industry dynamics. The significance of this contributionlies chiefly in highlighting the fact that exogenous technological change can, under appropriate conditions, play asignificant role in industry dynamics. This reference to the exogenous change in technology is a departure from thetraditional consideration of endogenity of industry structure in relation to technological development and, therefore, anovelty. Secondly, the documentation of 3D seismology as a significant process technology of the petroleum industryis significant.