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Charting the Territory : Recombination as a Source of Uncertainty for Potential Entrants

Author

Listed:
  • Martina Montauti

    (EM - EMLyon Business School)

  • Filippo Carlo Wezel

Abstract

In this paper, we conceptualize categories as regions of a cognitive map that structure the market and guide the investment decisions of potential entrants—i.e., of new and established organizations. We advance that, as a category appears altered via incumbents' acts of recombination, potential entrants face market-specific uncertainty and are discouraged to invest in that category. These negative effects of recombination on market entries are, however, mitigated at increasing values of category status. We test our arguments in the market for electronic music. The analyses of product and organizational entries in music styles between 1978 and 2011 lend support to our arguments.

Suggested Citation

  • Martina Montauti & Filippo Carlo Wezel, 2016. "Charting the Territory : Recombination as a Source of Uncertainty for Potential Entrants," Post-Print hal-02311888, HAL.
    • Handle: RePEc:hal:journl:hal-02311888
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    Citations

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    Cited by:

    1. Ma, Xufei & Deng, Ziliang & Tang, Yi, 2021. "Relieving status anxiety: How low-status firms respond to international status-heterophilous relationships," Journal of World Business, Elsevier, vol. 56(6).
    2. Heewon Chae, 2022. "Income or education? Community‐level antecedents of firms' category‐spanning activities," Strategic Management Journal, Wiley Blackwell, vol. 43(1), pages 93-129, January.
    3. Wang, Pengfei, 2019. "Price space and product demography: Evidence from the workstation industry, 1980–1996," Research Policy, Elsevier, vol. 48(9), pages 1-1.
    4. Giovanni Formilan & Cristina Boari, 2021. "The reluctant preference: communities of enthusiasts and the diffusion of atypical innovation [Management fashion]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 30(3), pages 823-843.
    5. Balázs Kovács & Gianluca Carnabuci & Filippo Carlo Wezel, 2021. "Categories, attention, and the impact of inventions," Strategic Management Journal, Wiley Blackwell, vol. 42(5), pages 992-1023, May.
    6. Diego Zunino & Fernando F. Suarez & Stine Grodal, 2019. "Familiarity, Creativity, and the Adoption of Category Labels in Technology Industries," Organization Science, INFORMS, vol. 30(1), pages 169-190, February.
    7. Goldenstein, Jan & Hunoldt, Michael & Oertel, Simon, 2019. "How optimal distinctiveness affects new ventures' failure risk: A contingency perspective," Journal of Business Venturing, Elsevier, vol. 34(3), pages 477-495.

    More about this item

    Keywords

    recombination;

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