<p>Have a look at monopolistic competition. It basically details how many industries can find their own niche in a differentiated product market. Some prominent papers in the subject:</p>

<ul>
<li><a href="https://assets.aeaweb.org/assets/production/journals/aer/top20/67.3.297-308.pdf" rel="nofollow">Dixit and Stigliz: Monopolistic Competition and Optimum Product Diversity</a></li>
<li><a href="https://www.princeton.edu/pr/pictures/g-k/krugman/krugman-increasing_returns_1978.pdf" rel="nofollow">Krugman: Increasing returns, monopolistic competition, and international trade</a></li>
<li><a href="http://www.tcd.ie/Economics/staff/ppwalsh/papers/Salop.pdf" rel="nofollow">Salop: Monopolistic Competition with Outside Goods</a></li>
</ul>

CC BY-SA 3.0
2016-09-16T15:51:21.807Z
2016-09-16T20:10:59.513Z
2016-09-16T20:10:59.513Z
Giskard
<p>The literature on innovation deals with activities such as research and development that give rise to new products. A good reference is "<a href="https://mitpress.mit.edu/books/innovation-and-incentives" rel="nofollow">Innovation and Incentives</a>" by Scotchmer.</p>

CC BY-SA 3.0
2016-09-16T17:27:30.277Z
2016-09-16T17:27:30.277Z
Ubiquitous
<p>Hey i'm doing a paper on the creation of an industry that has spawned from the another industry. I was wondering if there was particularly any interesting economic theory i should look at. </p>

<p>Some of my ideas For example because of the inherent social values of society demand is formed for newer services not traditionally offered by the industry creating a niche market segment. To which i guess i can talk about utility maximisation. And that's about how much i have so far.</p>

<reference-request>
Economic Theories for the creation of a new or separate Industry?
Ivan
# Economic Theories for the creation of a new or separate Industry?

(Asked by: username_0 on 2016-09-16)

Hey i'm doing a paper on the creation of an industry that has spawned from the another industry. I was wondering if there was particularly any interesting economic theory i should look at.

Some of my ideas For example because of the inherent social values of society demand is formed for newer services not traditionally offered by the industry creating a niche market segment. To which i guess i can talk about utility maximisation. And that's about how much i have so far.

**Tags:** reference-request


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## 2 answers

### Answer by username_1 on 2016-09-16. Score: 1 | Accepted answer

Have a look at monopolistic competition. It basically details how many industries can find their own niche in a differentiated product market. Some prominent papers in the subject:

* [Dixit and Stigliz: Monopolistic Competition and Optimum Product Diversity](https://assets.aeaweb.org/assets/production/journals/aer/top20/67.3.297-308.pdf)
* [Krugman: Increasing returns, monopolistic competition, and international trade](https://www.princeton.edu/pr/pictures/g-k/krugman/krugman-increasing_returns_1978.pdf)
* [Salop: Monopolistic Competition with Outside Goods](http://www.tcd.ie/Economics/staff/ppwalsh/papers/Salop.pdf)


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### Answer by username_2 on 2016-09-16. Score: 1

The literature on innovation deals with activities such as research and development that give rise to new products. A good reference is "[Innovation and Incentives](https://mitpress.mit.edu/books/innovation-and-incentives)" by Scotchmer.


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