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Matching response to competitors' moves under asymmetric market strength

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  • Hsieh, Kai-Yu
  • Hyun, Eunjung (E.J.)

Abstract

This paper investigates a firm's inclination to match a rival's strategic move under asymmetric market strength. Drawing from the awareness-motivation-capability framework, we theorize that a firm is more likely to match modestly weaker competitors to sustain its current lead and match modestly stronger competitors to eschew lagging further behind; conversely, a firm is less likely to match far weaker competitors due to its lack of attention and match far stronger competitors due to its inability to compete. Event history analysis of a set of IT companies' entry moves into various locations in China exhibits support for our hypotheses. Our findings suggest that a firm's matching response most often occurs under a moderate level of asymmetric market strength.

Suggested Citation

  • Hsieh, Kai-Yu & Hyun, Eunjung (E.J.), 2018. "Matching response to competitors' moves under asymmetric market strength," Journal of Business Research, Elsevier, vol. 82(C), pages 202-212.
    • Handle: RePEc:eee:jbrese:v:82:y:2018:i:c:p:202-212
    DOI: 10.1016/j.jbusres.2017.09.038
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    3. Roberto Stein, 2022. "‘Smart’ copycat mutual funds: on the performance of partial imitation strategies," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-31, December.

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