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How does worker mobility affect business adoption of a new technology? The case of machine learning Strateg. Manag. J. (IF 7.815) Pub Date : 2024-03-10 Ruyu Chen, Natarajan Balasubramanian, Chris Forman
Research SummaryWe investigate how worker mobility influences the adoption of a new technology using state‐level changes to the enforceability of noncompete agreements as an exogenous shock to worker mobility. Using data on over 153,000 establishments from 2010 and 2018, we find that changes that facilitate worker movements are associated with a significant decline in the likelihood of adoption of
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When do startups scale? Large‐scale evidence from job postings Strateg. Manag. J. (IF 7.815) Pub Date : 2024-03-08 Saerom (Ronnie) Lee, J. Daniel Kim
Research SummaryScaling at the right time is a crucial challenge for startups. Conceptualizing “scaling” as the entrepreneurial process of acquiring and committing resources to implement the core business idea and expand the customer base, this study examines how scaling early may decrease imitation risk at the expense of increasing commitment risk. As startups typically hire managers and sales personnel
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Introducing machine‐learning‐based data fusion methods for analyzing multimodal data: An application of measuring trustworthiness of microenterprises Strateg. Manag. J. (IF 7.815) Pub Date : 2024-03-06 Xueming Luo, Nan Jia, Erya Ouyang, Zheng Fang
Research SummaryMultimodal data, comprising interdependent unstructured text, image, and audio data that collectively characterize the same source, with video being a prominent example, offer a wealth of information for strategy researchers. We emphasize the theoretical importance of capturing the interdependencies between different modalities when evaluating multimodal data. To automate the analysis
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Gender gap in STEM entrepreneurship: Effects of the Affordable Care Act reform Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-29 Jiayi Bao
Research SummaryThis article examines whether the Affordable Care Act (ACA) health insurance reform reduced the gender gap in science, technology, engineering, and mathematics (STEM) entrepreneurship. I argue that the ACA mitigated mobility constraints imposed by employer‐provided health insurance and encouraged entrepreneurship with important contingencies: effects were limited to women because of
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Lovely and likely: Using historical methods to improve inference to the best explanation in strategy Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-29 Sandeep Devanatha Pillai, Brent Goldfarb, David Kirsch
Research SummaryMany strategy studies implicitly rely upon inference to the best explanation (IBE) or modern abduction. We leverage recent work in the philosophy of science to consider how we arrive at “best” explanations, explanations that are lovely, in the sense that they are useful, general, and provide meaning, and likely, in the sense that they are close to the truth. Interpretation of observational
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Erratum Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-26
The original article to which this Erratum refers was published in Strategic Management Journal. Vol. 44, Issue 3, pp. 737–777, 2023. DOI: 10.1002/smj.3460 The formula for “heterogeneity in the evaluative schemas of the audiences a firm engages with,” as it appears on pages 759 and 762 of our paper, omits the square root. This omission was an inadvertent typo error. The correct formula, which was
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The new argonauts: The international migration of venture‐backed companies Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-24 Yuan Shi, Olav Sorenson, David M. Waguespack
Research SummaryWe use a novel longitudinal dataset, constructed from 16 downloads of VentureXpert records collected over 20 years, to characterize the international migration of venture‐capital‐backed startups. We find that: (i) 1078 firms in our sample (1.4%) migrate; (ii) countries with high levels of in‐migration also have high levels of out‐migration; (iii) migrating firms move to places with
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Sweeping it under the rug: Positioning and managing pollution-intensive activities in organizational hierarchies Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-16 Juyoung Lee, Pratima Bansal
Many corporate groups have multiple layers with parent companies owning subsidiaries, which own other subsidiaries, and so forth, in a pyramid-like ownership structure. We argue that corporate groups perform their pollution-intensive activities at the lower levels of the corporate hierarchy to buffer the parent from pollution-related regulatory risks. Our analysis of 7400 US-based business establishments
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Product digitization and differentiation strategy change: Evidence from the book publishing industry Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-15 Cameron D. Miller, Richard D. Wang
We study product digitization as an impetus for firm strategy change. Product digitization can erode a firm's ability to differentiate through physical product attributes and prompts them to increase emphasis on nonphysical product attributes to sustain their competitive advantage. We expect this effect is pronounced among firms that have pursued a physical differentiation strategy prior to the digital
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The effect of flatter hierarchy on applicant pool gender diversity: Evidence from experiments Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-19 Reuben Hurst, Saerom (Ronnie) Lee, Justin Frake
Research SummaryThis article investigates how job seekers' perceptions of an employer's formal hierarchy affect the size and gender composition of its applicant pool. Building on the literature on gendered organizations and organizational design, we develop opposing perspectives on these relationships. To arbitrate between these perspectives, we first conduct a field experiment in partnership with
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The cue‐ball effect: How an advantaged firm's closer competitors can propagate the impact of its advantage to more distant competitors Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-19 Natarajan Balasubramanian, Richard Makadok, Wan‐Ting Chiu
Research SummaryCost advantage helps a firm at the expense of its rivals, but may hurt some rivals worse than others. Conventional wisdom suggests that an advantaged firm will do more harm to closer competitors, but the opposite may occur if competitors can reposition themselves. Closer competitors have stronger incentives to reposition away from the advantaged firm, thereby potentially encroaching
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Hedge fund activism in family firms Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-11 Emilie R. Feldman, Raphael (Raffi) Amit, Siwen Chen
This article examines the antecedents and outcomes of hedge fund activism in family versus nonfamily firms. We find that activist hedge funds are less likely to initiate campaigns against family firms than nonfamily firms, but the cumulative abnormal returns to announcements of campaigns against family firms exceed those of nonfamily firms. The presence of one or more family members on a firm's board
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Overcoming strategic persistence: Effects of multiple scenario analysis on strategic reorientation Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-06 Mark P. Healey, Gerard P. Hodgkinson
To thrive in an unpredictable world, managers must adapt their decision-making to changing events. However, a major impediment to adaptation is strategic persistence, that is, the tendency to stick with previously successful strategies. We examined whether multiple scenario analysis can help to overcome the dysfunctional effects of strategic persistence. In a laboratory study using a multi-round strategy
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Status and consensus: Heterogeneity in audience evaluations of female- versus male-lead films Strateg. Manag. J. (IF 7.815) Pub Date : 2024-02-01 Bryan K. Stroube, David M. Waguespack
Extant research finds that status characteristics such as gender are frequently related to average quality evaluations by external audiences, but little is known about whether such characteristics are also related to consensus in quality evaluations. We examine 383 million film ratings by consumers to document that female-lead movies elicit less consensus in quality evaluations than male-lead movies
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Caveat emptor as an obstacle to business transfers: Effect of product line liability exceptions on acquisitions, entry, and exit Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-30 Natarajan Balasubramanian, Jagadeesh Sivadasan, Wenjian Xu
Being able to sell a business not only allows a firm to exit an industry but is also a motivation for entrepreneurial entry. Therefore, factors that make acquisitions less desirable for potential acquirers could not only affect the rate of acquisitions, but also entry and exit. We test this in the context of judicial adoptions of product line exceptions, which increased acquirer exposure to potential
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Bribery, insecurity, and firm performance: Evidence from the Boko Haram insurgency in Nigeria Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-29 Stefan Dimitriadis
During armed conflicts, when the rule of law collapses, bribery often becomes prevalent. Yet, the effect of bribery on firm performance under those circumstances remains unclear. Bribery could provide access to scarce resources, but it could also be the result of extortion. This study argues that bribes can improve firm performance during certain conflicts, when violence reduces public officials' ability
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Poised for growth: Exploring the relationship between accelerator program design and startup performance Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-25 Valentina A. Assenova, Raphael Amit
Accelerator programs provide valuable market feedback and education to participants that may improve startup performance. However, it is unclear whether the average effect of accelerator participation on startup performance post acceleration is positive, and if so, how this effect varies with accelerator program design. We analyze data from 8580 startups that made it past the initial selection stage
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Transportation networks and competition in the market for corporate control Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-21 Marco Testoni
While competition in the market for corporate control determines firms' ability to capture value from acquisitions, there is limited evidence of factors that influence such competition. This study explores whether airline routes intensify competition in this market and affect the target's returns. Targets can become better connected to distant latent acquirers (DLAs), which can increase the targets'
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The inside track: Entrepreneurs' corporate experience and startups' access to incumbent partners' resources Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-18 Sarath Balachandran
Startups are increasingly turning to incumbent firms for venture capital, anticipating access to the investor's knowledge and complementary assets. However, startups' eventual access to these resources varies widely. This article highlights one important driver of such variance, whether startups' managers were previously employed by an incumbent in the same industry. Using data from the life sciences
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Knowledge diffusion in nascent industries: Asymmetries between startups and established firms in spurring inventions by other firms Strateg. Manag. J. (IF 7.815) Pub Date : 2024-01-07 Francisco Polidoro, Charlotte Jacobs
Research on industry evolution highlights the role of knowledge-building activities of startups and established firms in shaping knowledge evolution in a nascent industry. Yet, research thus far has overlooked the possibility that differences between startups and established firms might also shape the diffusion of the knowledge that they build. This study abductively explores this conjecture in the
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Supply-side inducements and resource redeployment in multiunit firms Strateg. Manag. J. (IF 7.815) Pub Date : 2023-12-14 Jasmina Chauvin, Christopher Poliquin
We examine to what extent and when multiunit firms internally redeploy managers between units. While theory has emphasized how changes in demand conditions affect redeployment, we argue that optimal internal resource allocation involves consideration of both demand and each unit's resource supply. We formalize this argument, showing how redeployment arises from “supply-side inducements”—return advantages
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Beyond the finish line: How losing in patent race drives post-race innovation Strateg. Manag. J. (IF 7.815) Pub Date : 2023-12-12 A-Sung Hong
Although patent races of leading technology firms have garnered significant attention in the prior literature, it remains unclear how the outcome of a patent race affects subsequent firm-level innovation. Drawing on agency theory, we propose that losing a patent race drives firms to pursue more technological innovation than winning due to managerial concerns. To investigate the mechanism, we hypothesize
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My kind of people: Political polarization, ideology, and firm location Strateg. Manag. J. (IF 7.815) Pub Date : 2023-12-10 Benjamin Barber, Daniel J. Blake
With increased political polarization, Americans are displaying more animus across, and affinity within, ideological identity groups. We argue this dynamic incentivizes firms to minimize ideological misalignments across their workforce by locating new establishments in areas that are ideologically proximate to their current operations. We further argue that the desire to minimize ideological distance
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To commercialize inside or outside of the firm: Behavioral considerations in patent exploitation by family firms Strateg. Manag. J. (IF 7.815) Pub Date : 2023-12-07 Addis Gedefaw Birhanu, Alfonso Gambardella
This article examines the relationship between family ownership and patent use strategy using primary data from a patent survey, as well as patent and firm-level data from secondary sources. The findings reveal that family firms are less likely than non-family firms to license their patents and more likely to internally commercialize them. We show that the decision of family firms to license less does
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Decision authority and the returns to algorithms Strateg. Manag. J. (IF 7.815) Pub Date : 2023-12-05 Hyunjin Kim, Edward L. Glaeser, Andrew Hillis, Scott Duke Kominers, Michael Luca
We evaluate a pilot in an Inspections Department to explore the returns to a pair of algorithms that varied in their sophistication. We find that both algorithms provided substantial prediction gains, suggesting that even simple data may be helpful. However, these gains did not result in improved decisions. Inspectors often used their decision authority to override algorithmic recommendations, partly
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Resource allocation and growth strategies in a multi-plant firm: Kanegafuchi Spinners in the early 20th century Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-30 Shotaro Yamaguchi, Serguey Braguinsky, Tetsuji Okazaki, Takenobu Yuki
Using detailed plant- and individual-level data from a major Japanese cotton spinning company in the early 20th century, we examine the within-firm allocation of skilled human capital in conjunction with investment in physical capital, accompanying the firm's evolving strategic priorities. We show that the firm leveraged unit-level two-way complementarity between managerial talent and strategically
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Spinning an entrepreneurial career: Motivation, attribution, and the development of organizational capabilities Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-30 Hyeonsuh Lee, Sonali K. Shah, Rajshree Agarwal
We inductively examine how the careers of employee entrepreneurs unfold, uncovering the role of motives and attribution for failure. Founders expressing organizational misalignment motives for leaving established organizations engaged in “venture crafting” whereby they actively sought to build well-functioning organizations. They built successful initial ventures and careers. Founders lacking organizational
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The racial gap in entrepreneurship and opportunities inside established firms Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-28 Tiantian Yang, Olenka Kacperczyk
Racial disparities in entrepreneurship have been widely discussed in the literature, with most studies focusing on mechanisms that amplify such disparities. However, less attention has been devoted to factors that promote inclusion. We propose that intrapreneurship—launching and operating new ventures inside established organizations—represents a more inclusive entrepreneurial pathway than entrepreneurship
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Ripple effects: How collaboration reduces social movement contention Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-28 Kate Odziemkowska, Mary-Hunter McDonnell
Research suggests firms can reduce stakeholder contention (e.g., lawsuits, protests) by collaborating with threatening stakeholders. We propose that by tapping into stakeholder networks and identities, collaborations also produce ripple effects beyond the firm's partner to attenuate contention from a broader set of stakeholders. Using variation in firms' and stakeholders' willingness to collaborate
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Risky business: How standardization as coordination tool in ecosystems impacts firm-level uncertainty Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-23 Puay Khoon Toh, Eugene Pyun
Coordination challenges generate uncertainties in ecosystems. Past research suggests that standardization mitigates these challenges, reducing ecosystem-level uncertainty. But how does it affect firm-level uncertainty over value-appropriation? We examine heterogeneity in the latter effect. Using 1996–2010 data on standard-setting in Information and Communications Technology (ICT) ecosystems and a firm-level
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Investing in general human capital as a relational strategy: Evidence on flexible arrangements with contract workers Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-16 Thomaz Teodorovicz, Sérgio Lazzarini, Sandro Cabral, Anita M. McGahan
This article examines a firm's investment in the general skills of contract workers in flexible work arrangements. It theorizes that this investment may prolong a productive firm-worker collaboration even when workers’ mobility barriers are low. It also proposes that achieving such benefits requires that the firm frames the relational benefits of the investments both to managers and workers. Such a
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Hunting for talent: Firm-driven labor market search in the United States Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-06 Ines Black, Sharique Hasan, Rembrand Koning
We analyze firm-driven labor market search, where firms “hunt” for talent rather than rely on workers to apply for vacancies. We leverage three approaches. We develop a model of firm-driven search and derive equilibrium conditions under which firms use this channel. We test our model's predictions using two data sources. Data from a nationally representative survey of 10,000 workers shows that the
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The role of information in the gender gap in the market for top managers: Evidence from a quasi-experiment Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-05 Ulya Tsolmon
This study examines the role of information in the gender gap in the executive labor market from the market frictions perspective. I ask whether increases in objective and reliable information about managerial quality close the gender gap in career advancements. To obtain exogenous variation in the availability of information, I exploit a natural experiment provided by the adoption of the International
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The new needs friends: Simmelian strangers and the selection of novelty Strateg. Manag. J. (IF 7.815) Pub Date : 2023-11-05 Athanasia Lampraki, Christos Kolympiris, Thorsten Grohsjean, Linus Dahlander
The paradox of rejecting novel ideas while being motivated to select them exists in many realms. Deviating from prior research that investigated several internal levers to promote the funding of novel ideas in the sciences, we focus on an external lever by investigating how seconded employees increase the selection of novel ideas in two ways: (1) they select more novel ideas themselves, and (2) they
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Community influence on microfinance loan defaults under crisis conditions: Evidence from Indian demonetization Strateg. Manag. J. (IF 7.815) Pub Date : 2023-10-25 Arzi Adbi, Matthew Lee, Jasjit Singh
The microfinance “group lending” approach has achieved widespread success in promoting high rates of repayment, and thus the viability of financial access, in very low-income environments. Yet group lending, which relies on social connections between borrowers to reinforce repayment, may be vulnerable under crisis conditions in which defaults are commonplace. We explore this possibility in the context
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Demand pull versus resource push training approaches to entrepreneurship: A field experiment Strateg. Manag. J. (IF 7.815) Pub Date : 2023-10-25 Simone Santamaria, Niloofar Abolfathi, Ishtiaq Pasha Mahmood
We compare the efficacy of two broad approaches to entrepreneurship training: a training prioritizing demand-side activities versus a training prioritizing resource-side activities. We do so by running a field experiment inside a 6-month entrepreneurship program involving 236 early-stage entrepreneurs. Inspired by our training, the first group invested more time interacting with potential customers
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Acqui-hires: Redeployment and retention of human capital post-acquisition Strateg. Manag. J. (IF 7.815) Pub Date : 2023-10-18 Beril Boyacıoğlu, Mahmut N. Özdemir, Samina Karim
Acqui-hires are now a prevalent strategic mechanism by which firms obtain talented human resources. They differ from traditional acquisitions in that they are always integrated and the focus is the people, not the product or service. Thus, how firms reconfigure through the redeployment and retention of acqui-hired human resources during post-acquisition integration is particularly critical. We find
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Coaxing corporations: Enriching the conceptualization of governments as strategic actors Strateg. Manag. J. (IF 7.815) Pub Date : 2023-10-02 Michael J. Gill, David J. Gill
Little is known about how governments secure discrete resources from global corporations over which they have limited direct control. Utilizing declassified archival sources, we examine how the UK government influenced Moody's and Standard & Poor's to provide the highest possible credit ratings in 1978, despite the UK receiving an International Monetary Fund bailout 2 years earlier. We develop a process
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Behavioral agency and the efficacy of analysts as external monitors: Examining the moderating role of CEO personality Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-26 Alina G. Andrei, Mirko H. Benischke, Geoffrey P. Martin
We integrate behavioral agency research and the five-factor model of personality to re-visit investment analysts' efficacy as a mechanism for reducing agency costs. We highlight the role of personality in shaping how CEOs respond to analyst recommendations, leading to boundary conditions for the efficacy of analysts as external monitors. We theorize that the extent to which a CEO perceives a threat
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Technology adoption and innovation: The establishment of airmail and aviation innovation in the United States, 1918–1935 Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-20 Eunhee Sohn, Robert Seamans, Daniel B. Sands
This article explores how technology adoption can shape innovative activity. We study this issue within the historical context of the introduction and expansion of airmail across the United States between 1918 and 1935 using archival material and a novel dataset of early 20th century patents. A joint qualitative and quantitative investigation indicates that local individual and corporate actors applied
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Performance metrics in strategy research: A new metric and method for assessing dynamic value Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-20 David Souder, J. Myles Shaver, Jared D. Harris, Abdullatif Alrashdan
We discuss two research design considerations that jointly influence the choice of financial performance metrics in strategy research: (a) expected temporal payoff of the strategic choice and (b) source of variation invoked in the research design (i.e., within-firm vs. between-firm comparisons). We map existing performance metrics commonly used in the research literature to these considerations, and
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Entrepreneurial framing: How category dynamics shape the effectiveness of linguistic frames Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-20 Karl Taeuscher, Hannes Rothe
How do new entrepreneurial ventures effectively deploy linguistic frames to attract customer demand? Drawing on framing and categories research, we develop and test theory about how category dynamics shape the effectiveness of two commonly observed frames—social impact framing and innovativeness framing—in the context of prosocial categories. We test our predictions by tracking entrepreneurial ventures
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Do financial market frictions hurt the performance of women-led ventures? A meta-analytic investigation Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-18 David Gaddis Ross, Dong Hyun Shin
Extant research offers conflicting views about the size and nature of gender-related disparities in venture financing and venture performance. We theorize that gender-related frictions in debt financing, the most common source of capital for new ventures, materially impair the performance of women-led ventures but that these frictions decline with financial development. We find strong support for these
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Windows versus waves of opportunity: How reputation alters venture capital firms' resource mobilization Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-11 Alicia DeSantola, Pavel I. Zhelyazkov, Benjamin L. Hallen
This paper investigates how reputation affects firm responses to resource mobilization opportunities. We theorize that lower-reputation firms are likely to be particularly responsive to resource mobilization opportunities because they are otherwise constrained. By contrast, higher-reputation firms have access to greater resource supply and may self-restrain demand. We test these arguments in the context
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Human resource redeployability and entrepreneurial hiring strategy Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-11 Liinus Hietaniemi, Simone Santamaria, Aleksandra Kacperczyk, Juhana Peltonen
The timing of talent acquisition is a central decision for new ventures. On one hand, hiring after demand is proven minimizes losses. On the other hand, hiring before demand is proven allows new ventures to start developing unique capabilities. We resolve this tension by proposing that the timing depends on human resource redeployability. We test our theory with the population of Finnish ventures showing
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The tangled webs we weave: Examining the effects of CEO deception on analyst recommendations Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-11 Steven J. Hyde, Eric Bachura, Jonathan Bundy, Richard T. Gretz, Wm. Gerard Sanders
Organizations are punished by analysts and investors when material deceit by their CEO is uncovered. However, few studies examine analysts' responses to deceptive CEOs before their deceit is publicly known. We use machine learning (ML) models to operationalize the likelihood of CEO deception as well as analysts' suspicion of CEO deception on earnings calls. Controlling for analysts' suspicion of deception
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Positioning for optimal distinctiveness: How firms manage competitive and institutional pressures under dynamic and complex environment Strateg. Manag. J. (IF 7.815) Pub Date : 2023-09-04 Jingqin Su, Xin Gao, Justin Tan
How firms strategically balance legitimacy and distinctiveness has garnered significant attention but reflects inconsistent perspectives. This inconsistency may stem from the inherent complexity of optimal distinctiveness (OD), which are sensitive to both the context and temporality. This article explores dynamic changes in institutional and competitive pressures and how they co-evolve with different
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Rating systems and increased heterogeneity in firm performance: Evidence from the New York City Restaurant Industry, 1994–2013 Strateg. Manag. J. (IF 7.815) Pub Date : 2023-08-28 Jason Greenberg, Daniel B. Sands, Gino Cattani, Joseph Porac
We investigate the extent to which the increasing availability of ratings information has affected heterogeneity in firm performance and, if so, what market segments are responsible for these changes. A unique dataset was constructed with restricted-access government data to examine these questions in the context of the New York City restaurant industry between 1994 and 2013. We find that firms serving
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Missed chances and unfulfilled hopes: Why do firms make errors in evaluating technological opportunities? Strateg. Manag. J. (IF 7.815) Pub Date : 2023-08-23 Amit Kumar, Elisa Operti
This study examines commission and omission errors in the evaluation of technological opportunities. Integrating structural and cognitive perspectives, we propose that inventors with more cohesive collaboration networks within the firm or geographically closer to the corporate headquarters exert greater influence on the dominant representations shaping opportunity evaluation within the firm. Thus,
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Heterogeneous adaptability: Learning, cash resources, and the fine-grained adjustment of misaligned governance Strateg. Manag. J. (IF 7.815) Pub Date : 2023-08-02 Xavier Martin, Ilya R. P. Cuypers
When can a firm make fine-grained adjustments to misaligned subsidiary governance? We examine whether and under what conditions a firm will adapt the equity stake it owns in a subsidiary, enabling improved alignment of the stake with the uncertainty in the local environment. We predict that the rate of adaptation of misaligned equity stakes depends on the experiential and vicarious learning from which
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Scaling nonhierarchically: A theory of conflict-free organizational growth with limited hierarchical growth Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-31 Eucman Lee, Ekin Ilseven, Phanish Puranam
We propose a theory that explains variations in the relationship between an organization's size and the extent of its authority hierarchy (as captured in managerial intensity). Conceptualizing authority hierarchy as a means to manage conflicts among subordinates, we formulate a model in which the number of managers required depends on the magnitude of conflicts generated between and within groups of
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Giant cluster formation and integrating role of bridges in social diffusion Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-27 Sungyong Chang, Jeho Lee, Jaeyong Song
In social networks, isolated subgroups often aggregate into a massively connected subgroup, or a giant cluster, when bridges are built across subgroups. To understand the roles of bridges in integrating subgroups, we develop models focusing on the percentage of bridges among all ties. When it is below 1%, diffusion does not affect many individuals because the system is merely a collection of fragmented
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Impact investing in disadvantaged urban areas Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-26 Romain Boulongne, Rodolphe Durand, Caroline Flammer
We examine whether impact investing is more effective in fostering business venture success and social impact when investments are directed toward ventures in disadvantaged urban areas compared to similar investments directed toward ventures outside these areas. We explore this question in the context of loans made to business ventures in French “banlieues” versus “non-banlieues.” We find that, following
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Cashing in on the culture wars? CEO activism, wokewashing, and firm value Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-25 Gaia Melloni, Andrea Patacconi, Nick Vikander
In this article, we examine under what conditions CEO activism—the practice of corporate leaders to take public stances on sociopolitical issues—can create firm value. In our model consumers care about the type of firm they buy from, but also understand that corporate leaders can make false or misleading statements to pander to valuable demographics. We show that, although the profitability of CEO
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Network advantage: Uncontested structural holes and organizational performance in market crises Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-19 Andrew Shipilov, Stan X. Li, Matthew S. Bothner, Nghi Truong
We examine how crisis conditions affect the link between structural holes and organizational performance. Since brokerage offers early access to diverse perspectives and autonomy in exchange relations, the benefits of brokerage should rise when crises erupt. However, evidence on the subject has been inconclusive, raising the question of whether crisis actually imposes a boundary condition on structural
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The octopus that shrank: A historical analysis of how multinationals address policy and contractual uncertainty in a global value chain Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-18 Marcelo Bucheli, Luciano Ciravegna, Luis Felipe Sáenz
We analyze how the evolution of the broad institutional environment influences the vertical integration strategy of a multinational corporation (MNC) leading a global value chain (GVC). We develop a history-to-theory study based on the evolution of the banana GVC between 1899 and 1991. We argue that when a MNC's bargaining power vis-à-vis the host government is strong, it will choose a governance structure
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The growth of hierarchy in organizations: Managing knowledge scope Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-12 Megan Lawrence, Christopher Poliquin
Theory posits hierarchy as a response to coordination challenges and emphasizes organization size and the need to transfer knowledge as the mainspring of these challenges. This connection, however, is largely based on the quantity of knowledge to be transferred rather than its characteristics. Building on the knowledge-based view, we propose that knowledge scope—the variety of knowledge across an organization's
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The theory-based view: Entrepreneurial microfoundations, resources, and choices Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-12 Robert Wuebker, Todd Zenger, Teppo Felin
We build on the theory-based view and highlight how an entrepreneur's theory can enable the creation of value. We point to three types of theories: theories of resource arbitrage, resource recombination, or resource investment that specialize resources to particular uses. However, possessing a unique theory is not enough. The realization of an entrepreneur's theory is contingent on matching it with
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CSR decoupling within business groups and the risk of perceived greenwashing Strateg. Manag. J. (IF 7.815) Pub Date : 2023-07-02 Joel Bothello, Ioannis Ioannou, Vlad-Andrei Porumb, Yasemin Zengin-Karaibrahimoglu
Given the growing legitimacy of corporate social responsibility (CSR), many firms engage in symbolic communication to showcase CSR without undertaking commensurate substantive actions. This “CSR decoupling” can create a risk of perceived greenwashing, which, in turn, may negatively affect a firm's performance. In this study, we explore an unexamined antecedent of decoupling: interfirm affiliation.