The problem of embeddedness revisited: Collaboration and market types
AbstractEmbeddedness has been touted as a framework for knowledge exchange and innovation, and thus as an important precondition for high-level performance. Embeddedness of economic action in social relations improves access to resources, but over-embeddedness impedes performance. However, until now the association between embeddedness and performance in different markets has been neglected. This paper challenges the predominant view of embeddedness and over-embeddedness as absolute and mutually exclusive conditions. Through regression analyses of novel data from a project-based industry, the paper tests the association between embeddedness and economic performance in different markets, finding a positive association in the domestic market, but a negative association in foreign markets. This divergence in performance is caused in part by selection bias in the access to foreign markets, and in part by accumulation of localized knowledge.
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Bibliographic InfoArticle provided by Elsevier in its journal Research Policy.
Volume (Year): 42 (2013)
Issue (Month): 1 ()
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Web page: http://www.elsevier.com/locate/respol
Embeddedness; Knowledge transfer; Opportunity allocation;
Find related papers by JEL classification:
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
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