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An ecological theory of population-level organizational diversity


  • BOONE, Christophe
  • WEZEL, Filippo Carlo


The question as to the evolution of population-level organizational diversity is at the heart of macro-level organizational sociology. However, the number of studies that direct this question explicitly is very limited, particularly in the empirical arena. We suggest a diversity-dependence theory that maps the macro-level evolution of organizational diversity with the micro-level events of entry and exit. We develop hypotheses as to the decision where to locate in product space by new entrants, as well as the likelihood of exit by incumbent firms given their location in product space. The key argument is that the micro-level entrants’ location decision and incumbents’ exit likelihood are both conditional upon macro-level organizational diversity, and that these events affect the evolution of population-level organizational diversity. Our hypotheses are tested in the British motorcycle industry in the 1895-1993 period, where we find support for our theory.

Suggested Citation

  • BOONE, Christophe & WEZEL, Filippo Carlo & VAN WITTELOOSTUIJN, Arjen, 2006. "An ecological theory of population-level organizational diversity," Working Papers 2007003, University of Antwerp, Faculty of Applied Economics.
  • Handle: RePEc:ant:wpaper:2007003

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    6. Kaiser, Ulrich, 2002. "Measuring knowledge spillovers in manufacturing and services: an empirical assessment of alternative approaches," Research Policy, Elsevier, vol. 31(1), pages 125-144, January.
    7. W. Chan Kim & Renée Mauborgne, 1998. "Abstract," Strategic Management Journal, Wiley Blackwell, vol. 19(4), pages 323-338, April.
    8. Christophe Boone & Glenn R. Carroll & Arjen van Witteloostuijn, 2004. "Size, differentiation and the performance of Dutch daily newspapers," Industrial and Corporate Change, Oxford University Press, vol. 13(1), pages 117-148, February.
    9. van Witteloostuijn, Arjen & van Wegberg, Marc, 1992. "Multimarket competition : Theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 18(2), pages 273-282, July.
    10. Christophe Boone & Arjen van Witteloostuijn, 2004. "A unified theory of market partitioning: an integration of resource-partitioning and sunk cost theories," Industrial and Corporate Change, Oxford University Press, vol. 13(5), pages 701-725, October.
    11. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, Oxford University Press, vol. 87(3), pages 355-374.
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