Partner Selection Decisions in Interfirm Collaborations: The Paradox of Relational Embeddedness

By combining insights from relational network theory and agency theory we identify the boundary conditions to the embeddedness approach to partner selection decisions in interfirm collaborations. Employing a longitudinal dataset comprising the investment syndicates for the population of UK managemen...

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Bibliographic Details
Published in:Journal of management studies 2010-09, Vol.47 (6), p.995-1019
Main Authors: Meuleman, Miguel, Lockett, Andy, Manigart, Sophie, Wright, Mike
Format: Article
Language:English
Subjects:
Agency
Agency theory
Boundary conditions
Business networks
Collaboration
Data analysis
Decision making
Investment
Management buyouts
Network analysis
Strategic planning
Studies
United Kingdom
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Summary:By combining insights from relational network theory and agency theory we identify the boundary conditions to the embeddedness approach to partner selection decisions in interfirm collaborations. Employing a longitudinal dataset comprising the investment syndicates for the population of UK management buyouts between 1993 and 2003, we find that relational embeddedness is less important for selecting partners when agency risks are low, allowing firms to expand their networks. Furthermore, reputational capital may act as a partial substitute for relational embeddedness, again permitting firms to expand their networks. Our findings enhance understanding of the boundary conditions associated with the relational network approach to partner selections and network behaviour.
ISSN:0022-2380
1467-6486
DOI:10.1111/j.1467-6486.2009.00897.x