The Joint Effect of Technological Distance and Market Distance on Strategic Alliances
The literature on strategic alliances has deepened our understanding of the mechanisms behind their formation. This literature has given a central role to complementarities between firms, whereby complementarities are usually measured by technological overlap. An established result tells us that, there is an inverted-u relationship between technological distance and learning by firms. In this paper, we argue that technological distance is only one aspect of complementarities. Equally important is the market distance, which we define as the extent to which the value generated by the alliance depends on the synergies between firms’ products. These synergies may occur because of the complementarities between products, or the possibilities to apply similar knowledge fields in different product domains. Through an agent based simulation study, we show that when firms consider both distances jointly, an alliance strategy which favours being close in at least one dimension yields the highest payoff, rather than being at the intermediate distance in both dimensions.
|Date of creation:||2010|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +33 3 68 85 20 69
Fax: +33 3 68 85 20 70
Web page: http://www.beta-umr7522.fr/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Benjamin Gomes-Casseres & John Hagedoorn & Adam B. Jaffe, 2002.
"Do Alliances Promote Knowledge Flows?,"
in: Corporate Alliances
National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:ulp:sbbeta:2010-22. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.