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Organizational Synergy, Dissonance and Spinoffs

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  • Mili Shrivastava

    ()
    (Entrepreneurship, Growth and Public Policy Group, Max Planck Institute of Economics, Jena)

  • T.V.S.Ramamohan Rao

    ()
    (Indian Institute of Technology, Kanpur)

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    Abstract

    Spinoff firms are exceptional performers across industries. The causes for the emergence of spinoff firms are widely investigated in the literature. However, the role of teams for spinoffs has received little scholarly attention. On one hand, talented individuals may find it necessary to team up with others to utilize complementary knowledge and generate synergies. On the other hand, some types of team production environments may have dissonance and motivate individuals to leave the team. The present study demonstrates that organizational synergies and dissonance can be incorporated into appropriate specifications of team production functions. This framework explains the necessity to form a team, stability of teams, and the emergence of different types of spinoffs depending on specific organizational arrangements.

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    Bibliographic Info

    Paper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2010-060.

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    Date of creation: 08 Sep 2010
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    Handle: RePEc:jrp:jrpwrp:2010-060

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    Keywords: Organizational synergy; Production functions; Spinoffs;

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    1. Casadesus-Masanell, Ramon & Spulber, Daniel F, 2000. "The Fable of Fisher Body," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 43(1), pages 67-104, April.
    2. April Mitchell Franco & Darren Filson, 2000. "Knowledge diffusion through employee mobility," Staff Report, Federal Reserve Bank of Minneapolis 272, Federal Reserve Bank of Minneapolis.
    3. van Praag, C M & Cramer, J S, 2001. "The Roots of Entrepreneurship and Labour Demand: Individual Ability and Low Risk Aversion," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 68(269), pages 45-62, February.
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