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Resistance to Change

Author

Listed:
  • James Dow

    (LBS)

  • Enrico Perotti

    (University of Amsterdam)

Abstract

Established firms often fail to maintain leadership following disruptive market shifts. We argue that such firms are more prone to internal resistance. A radical adjustment of assets affects the distribution of employee rents, creating winners and losers. Losers resist large changes when strong customer goodwill cushions the consequences. Partial adaptation may lead winners to depart to form new firms with no goodwill, but no internal resistance.

Suggested Citation

  • James Dow & Enrico Perotti, 2010. "Resistance to Change," Working Papers 2010.48, Fondazione Eni Enrico Mattei.
    • Handle: RePEc:fem:femwpa:2010.48
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    References listed on IDEAS

    as
    1. Gibbons, Robert, 2005. "Four forma(lizable) theories of the firm?," Journal of Economic Behavior & Organization, Elsevier, vol. 58(2), pages 200-245, October.
    2. repec:ner:ucllon:http://discovery.ucl.ac.uk/17678/ is not listed on IDEAS
    3. Acemoglu, Daron, 2003. "Why not a political Coase theorem? Social conflict, commitment, and politics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 620-652, December.
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    8. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 1-29, February.
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    Cited by:

    1. Cronin, Hugh & McGuinness, Seamus, 2014. "Examining the Relationship between Employee Resistance to Changes in Job Conditions and Wider Organisational Change: Evidence from Ireland," IZA Discussion Papers 8441, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Resistance to Change; Leadership; Adaptation;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory

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