This paper, presented at the IUI Conference on the Dynamics of Decentralized (Market) Economies in 1983, explores Schumpeterian competition in alternative technological regimes. The author, Sidney Winter, extends previous work by Nelson and Winter, using a Markov model to analyze the dynamics of an industry where firms produce homogeneous products and compete through cost reduction or product innovation. The model incorporates exogenous technological opportunities and the costs and uncertainties associated with innovation and imitation. The paper focuses on the historical shape of industry evolution, particularly the relative importance of entrants and established firms as sources of innovation. It introduces a new model of entry, which is crucial for understanding industry birth and the role of innovator-founders. The paper discusses the concept of technological regimes, distinguishing between "science-based" and "cumulative" regimes, and explores how these regimes influence the patterns of industrial development. The simulations in the paper illustrate the differences between "early Schumpeter" and "late Schumpeter" patterns, highlighting the role of entrants and established firms in driving innovation. The paper concludes with suggestions for further development of the concept of technological regime.This paper, presented at the IUI Conference on the Dynamics of Decentralized (Market) Economies in 1983, explores Schumpeterian competition in alternative technological regimes. The author, Sidney Winter, extends previous work by Nelson and Winter, using a Markov model to analyze the dynamics of an industry where firms produce homogeneous products and compete through cost reduction or product innovation. The model incorporates exogenous technological opportunities and the costs and uncertainties associated with innovation and imitation. The paper focuses on the historical shape of industry evolution, particularly the relative importance of entrants and established firms as sources of innovation. It introduces a new model of entry, which is crucial for understanding industry birth and the role of innovator-founders. The paper discusses the concept of technological regimes, distinguishing between "science-based" and "cumulative" regimes, and explores how these regimes influence the patterns of industrial development. The simulations in the paper illustrate the differences between "early Schumpeter" and "late Schumpeter" patterns, highlighting the role of entrants and established firms in driving innovation. The paper concludes with suggestions for further development of the concept of technological regime.