From the People Who Brought You Voodoo Economics

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George Gilder, in the March-April 1988 HBR, attacked MIT's Charles Ferguson for believing that many, small, entrepreneurial companies will do more for U.S. competitiveness than a few, large, integrated ones. Gilder claimed that advanced computer technology (engendering the "law of the microcosm") lowers barriers to market entry and promises to make talk of a national industrial policy obsolete. Here Charles Ferguson joins the debate and refutes Gilder's claims with an analysis of the U.S. semiconductor industry. Ferguson shows that U.S. companies lose out, not to nimble, small companies but to huge, protected Japanese complexes that are embedded in stable, concentrated, coordinated alliances.
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