IDEAS home Printed from https://ideas.repec.org/a/sae/envira/v26y1994i1p9-32.html
   My bibliography  Save this article

Strategy and Structure: Corporate Restructuring and the Scope and Characteristics of Sunk Costs

Author

Listed:
  • G L Clark

    (Institute of Ethics and Public Policy, and Department of Geography and Environmental Science, Monash University, Wellington Road, Clayton, VIC 3168, Australia)

Abstract

Most studies of industrial restructuring and regional adjustment are focused upon the local consequences or causes of restructuring. Few studies are focused upon corporate strategy, an essential ingredient for a better understanding of the motive forces behind restructuring. This paper is an attempt to redress the balance, beginning with the relationship between structure (the inherited configuration of production) and strategy (the design and implementation of restructuring). As part of this analysis, three types of strategy are distinguished: structure-dependent, structure-limited, and structure-focused strategies. To appreciate better the connection between the choice of strategy and corporate form, a series of models of corporate control are developed that distinguish between ownership and management. These preliminary arguments are then used to analyse the scope of sunk costs—that portion of fixed costs which are non-recoverable. To illustrate the scope of the framework used, recent examples of restructuring from northeast Asia and North America are interpreted in the light of the analytical model.

Suggested Citation

  • G L Clark, 1994. "Strategy and Structure: Corporate Restructuring and the Scope and Characteristics of Sunk Costs," Environment and Planning A, , vol. 26(1), pages 9-32, January.
    • Handle: RePEc:sae:envira:v:26:y:1994:i:1:p:9-32
    DOI: 10.1068/a260009
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1068/a260009
    Download Restriction: no
    File URL: https://libkey.io/10.1068/a260009?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    2. Hoshi, Takeo & Kashyap, Anil & Scharfstein, David, 1990. "The role of banks in reducing the costs of financial distress in Japan," Journal of Financial Economics, Elsevier, vol. 27(1), pages 67-88, September.
    3. Simon, Herbert A., 1985. "Human Nature in Politics: The Dialogue of Psychology with Political Science," American Political Science Review, Cambridge University Press, vol. 79(2), pages 293-304, June.
    4. S Finne & R Laulajainen, 1992. "Gaming in Spatial Expansion Tracks: The Case of the Swedish Brewery Industry," Environment and Planning A, , vol. 24(7), pages 1021-1037, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Konstantinos Melachroinos & Nigel Spence, 1999. "Regional Economic Performance and Sunk Costs," Regional Studies, Taylor & Francis Journals, vol. 33(9), pages 843-855.
    2. J. Painter & M. Chisholm & S. C. Dow & N. A. Phelps & R. J. Buswell & I. H. McNicoll & C. M. Law & M. E. Cawley & B. Archer, 1996. "Book Reviews," Regional Studies, Taylor & Francis Journals, vol. 30(3), pages 311-316.
    3. Lisa A. Hagerman & Tessa Hebb & Anna Steiger, 2008. "The role of community partners in urban investments," Public and Community Affairs Discussion Papers 2008-02, Federal Reserve Bank of Boston.
    4. H. D. Watts & J. D. Kirkham, 1999. "Plant Closures by Multi-locational Firms: A Comparative Perspective," Regional Studies, Taylor & Francis Journals, vol. 33(5), pages 413-424.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Charles W. Calomiris, 1993. "Corporate-Finance Benefits from Universal Banking: Germany and the United States, 1870-1914," NBER Working Papers 4408, National Bureau of Economic Research, Inc.
    2. Naoshi Ikeda & Kotaro Inoue & Sho Watanabe, 2018. "Enjoying the Quiet Life: Corporate Decision-making by Entrenched Managers," NBER Chapters, in: Corporate Governance (NBER-TCER-CEPR Conference), National Bureau of Economic Research, Inc.
    3. Lichtenberg, Frank R. & Pushner, George M., 1994. "Ownership structure and corporate performance in Japan," Japan and the World Economy, Elsevier, vol. 6(3), pages 239-261, October.
    4. Limpaphayom, Piman & Rogers, Daniel A. & Yanase, Noriyoshi, 2019. "Bank equity ownership and corporate hedging: Evidence from Japan," Journal of Corporate Finance, Elsevier, vol. 58(C), pages 765-783.
    5. Christine Pochet, 2001. "Le gouvernement de l'entreprise défaillante: étude de trente plans de continuation," Revue Finance Contrôle Stratégie, revues.org, vol. 4(2), pages 149-181, March.
    6. Jeffrey A. Frankel., 1992. "The Evolving Japanese Financial System, and the Cost of Capital," Center for International and Development Economics Research (CIDER) Working Papers C92-002, University of California at Berkeley.
    7. Nachane, D M & Ghosh, Saibal & Ray, Partha, 2005. "Bank nominee directors and corporate performance: micro evidence for India," MPRA Paper 1714, University Library of Munich, Germany.
    8. Randall Morck, 2011. "Finance and Governance in Developing Economies," Annual Review of Financial Economics, Annual Reviews, vol. 3(1), pages 375-406, December.
    9. Cai, Jun & Cheung, Yan-Leung & Goyal, Vidhan K., 1999. "Bank monitoring and the maturity structure of Japanese corporate debt issues," Pacific-Basin Finance Journal, Elsevier, vol. 7(3-4), pages 229-249, August.
    10. Randall Morck & Masao Nakamura & Murray Frank, 2001. "Japanese Corporate Governance and Macroeconomic Problems," Palgrave Macmillan Books, in: Masao Nakamura (ed.), The Japanese Business and Economic System, chapter 12, pages 325-363, Palgrave Macmillan.
    11. Williamson, Oliver E., 2010. "Transaction Cost Economics: The Natural Progression," Journal of Retailing, Elsevier, vol. 86(3), pages 215-226.
    12. Klaus Gugler, 1998. "Corporate Ownership Structure in Austria," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 25(3), pages 285-307, January.
    13. Kang, Jun-Koo & Shivdasani, Anil, 1997. "Corporate restructuring during performance declines in Japan," Journal of Financial Economics, Elsevier, vol. 46(1), pages 29-65, October.
    14. Isil Erol & Dogan Tirtiroglu, 2011. "Concentrated Ownership, No Dividend Payout Requirement and Capital Structure of REITs: Evidence from Turkey," The Journal of Real Estate Finance and Economics, Springer, vol. 43(1), pages 174-204, July.
    15. Randall Morck, 2003. "Why Some Double Taxation Might Make Sense: The Special Case of Inter-corporate Dividends," NBER Working Papers 9651, National Bureau of Economic Research, Inc.
    16. repec:ipg:wpaper:2014-591 is not listed on IDEAS
    17. Elena Zoido, 1998. "Un estudio de las participaciones accionariales de los bancos en las empresas españolas," Investigaciones Economicas, Fundación SEPI, vol. 22(3), pages 427-467, September.
    18. Gorton, Gary & Rosen, Richard, 1995. "Corporate Control, Portfolio Choice, and the Decline of Banking," Journal of Finance, American Finance Association, vol. 50(5), pages 1377-1420, December.
    19. B. Scholtens, 1997. "Bank- and market-oriented financial systems: fact or fiction?," Banca Nazionale del Lavoro Quarterly Review, Banca Nazionale del Lavoro, vol. 50(202), pages 301-323.
    20. Kang, Jun-Koo & Shivdasani, Anil, 1999. "Alternative mechanisms for corporate governance in Japan: An analysis of independent and bank-affiliated firms," Pacific-Basin Finance Journal, Elsevier, vol. 7(1), pages 1-22, February.
    21. Kentaro Koga & Satomi Uchino, 2012. "Bank-Firm Relationships and Security Analyst Activities: Evidence from Japan," The Japanese Accounting Review, Research Institute for Economics & Business Administration, Kobe University, vol. 2, pages 49-73, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:envira:v:26:y:1994:i:1:p:9-32. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.