Value Chain Relatedness: Strategic Complementarities and Firm Performance
AbstractThis study extends the literature on relatedness and firm performance to consider customer side as well as technological side relatedness. Recent studies indicate the importance of each source of relatedness but yield ambiguous findings regarding their impacts on performance. Conjecturing this ambiguity reflects methodological limitations related to prior studies? use of survey data to develop measures of relatedness, we instead develop a secondary data method to measure technological and customer relatedness for a large sample of U.S. firms from 1984 to 2004. Estimating a model in which relatedness and firm performance are simultaneously determined, we find that, unlike prior studies, each source of relatedness has a positive direct effect on firm performance and a positive indirect effect that reflects complementarity between each source of relatedness.
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Bibliographic InfoPaper provided by McColl School of Business, Queens University of Charlotte in its series Discussion Paper Series with number 2012-03.
Length: 33 pages
Date of creation: 2012
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-10-27 (All new papers)
- NEP-BEC-2012-10-27 (Business Economics)
- NEP-CSE-2012-10-27 (Economics of Strategic Management)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bowen, H.P. & Wiersema, M., 2007.
"International and product diversification: their interrelationship and impact on firm performance,"
Vlerick Leuven Gent Management School Working Paper Series, Vlerick Leuven Gent Management School
2007-6, Vlerick Leuven Gent Management School.
- Harry P. Bowen & Margarethe Wiersema, 2009. "International and Product Diversification: Their Interrelationship and Impact on Firm Performance," Discussion Paper Series, McColl School of Business, Queens University of Charlotte 2009-04, McColl School of Business, Queens University of Charlotte.
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For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (HP Bowen).
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