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Publication: Journal of Forest Products Business Research
Authors: 0
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Publish Year: 2004
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Title: Adoption of Innovations in Tradition-bound Industries: Uncertainty and Competitive Rivalry Effects on Adoption of Wood Products
A common perception of tradition-bound industries is that they are less inclined to adopt new product and process innovations. The residential construction industry is commonly described as one such tradition-bound industry in that the methods and materials that this industry utilizes have been perceived as remaining comparatively static over the past several decades relative to other
industrial sectors. The residential construction industry , however, represents one of the largest industrial sectors in the U.S. economy . The importance of the residential construction industry to the overall economy is well understood, as its activity significantly affects the performance of supplier and allied industries. The importance of residential construction as a driver of the domestic forest
resources and wood products industries is quite clear; approximately 35 to 45 percent of all softwood structural lumber and structural panel products manufactured in the United States is utilized in the construction of residential buildings. The literature associated with the residential construction
industry arrives at a consensus that the fragmented structure of the industry has led builders to be more cautious in adopting prov en innovations that would enhance firm, industry , and finished product performance. Some researchers contend that the competitive nature of the industry is a root cause of builders’ risk aversion with regard to innovativ e building products. This study explores the
linkage between builders’ perceptions of uncertainty and competition within the residential construction industry and firm adoption of innovativ e wood-based building materials. Hypotheses are developed and tested using data collected from 1 30 residential construction firms located in three states along the Pacific Coast. Study results strongly suggest that builders’ perceptions of uncertainty
and competition do not significantly affect firm adoption of innovative wood-based building materials. Implications of the study ’s results on product innovation within the forest products industry are discussed.

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