Columbia International Affairs Online: Working Papers

CIAO DATE: 07/2010

The Dissolution of Sectors: Do Politics and Sectors Still Go Together?

Mark Huberty

April 2010

Berkeley Roundtable on the International Economy


Technological change has altered firm behavior in ways that are rendering sectoral models of political economy inadequate for understanding the economic and political consequences of modern market evolution. I use cases from the computer and medical devices industries to demonstrate this process, its key variables, and consequences for firm preferences. Firms in both industries have moved into new sectors with integrated goods-services product strategies. In doing so, they have disrupted, or put into dispute, the political configurations that characterized those sectors in the past. I conclude with three suggestions on why the disintegration of sectors remains uneven across industries: that it may depend on the degree of information dependence in the industry; on the availability of suitable regulatory templates to guide firm action; or on the prior-existing role of services in the firm’s home sector business