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Corporate Renewal Through Internal Venturing and Spinn-offs: Perspectives from Organizational Economics


  • Tom Elfring
  • Nicolai J. Foss


We address the closely related phenomena of corporate venturing and spin-offs in the context of organizational economics, for example, agency perspectives and the evolutionary perspective on firms. These perspectives allow us to say something about both the amount and nature of variety creation inside firms. For example, there are strong arguments that firms will tend to produce too few and too "narrow" venture ideas. Moreover, organizational economics is helpful in deriving propositions about the occurrence of spin-offs, which we separate into "vicious" and "virtuous" ones. The former type refers to ventures that could have helped bringing corporate renewal, but where overruled venture managers left the firm in frustration. The latter type refers to ventures that are too far away from the firm's core business(es) to assist in corporate renewal, but where their spin-off is tantamount to a learning experience to the firm.

Suggested Citation

  • Tom Elfring & Nicolai J. Foss, "undated". "Corporate Renewal Through Internal Venturing and Spinn-offs: Perspectives from Organizational Economics," IVS/CBS Working Papers 97-7, Department of Industrial Economics and Strategy, Copenhagen Business School.
  • Handle: RePEc:ivs:iivswp:97-7

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    corporate renewal; spin-offs; economic organization; intrapreneurship;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups


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