Abstract
We discuss existing research that applies a relational, socio-structural lens to studying organizations and markets. Research in this field has described markets first and foremost as networks of enduring relationships and repeated interactions among organizations. We start by addressing some of the key findings of extant research regarding the antecedents of network structures and variations in their emergent structural properties. We then evaluate the implications of these network structures for a range of organizational behaviours and outcomes, exploring the underlying mechanisms for the effects of networks.
This entry was originally published on Palgrave Connect under ISBN 978-1-137-49190-9. The content has not been changed.
References
Ahuja, G. 2000. Collaboration networks, structural holes, and innovation: A longitudinal study. Administrative Science Quarterly 45: 425–455.
Aldrich, H.E. 1979. Organizations and environments. Englewood Cliffs: Prentice Hall.
Bae, J., and M. Gargiulo. 2004. Partner substitutability, alliance network structure, and firm profitability in the telecommunications industry. Academy of Management Journal 47: 843–859.
Baker, W.E. 1990. Market networks and corporate behavior. American Journal of Sociology 96: 589–625.
Baker, W.E., R.R. Faulkner, and G. Fisher. 1998. Hazards of the market: The continuity and dissolution of interorganizational market relationships. American Sociological Review 63: 147–177.
Baum, J.A.C., T. Calabrese, and B.S. Silverman. 2000. Don’t go it alone: Alliance network composition and startups’ performance in Canadian biotechnology. Strategic Management Journal 21: 267–294.
Baum, J.A.C., A.V. Shipilov, and T. Rowley. 2003. Where do small worlds come from? Industrial and Corporate Change 12: 697–725.
Baum, J.A.C., T.J. Rowley, A.V. Shipilov, and Y.-T. Chuang. 2005. Dancing with strangers: Aspiration performance and the search for underwriting syndicate partners. Administrative Science Quarterly 50: 536–575.
Baum, J.A.C., B. McEvily, and T. Rowley. 2012. Better with age? Tie longevity and the performance implications of bridging and closure. Organization Science 23: 529–546.
Beckman, C.M., and P.R. Haunschild. 2002. Network learning: The effects of partners’ heterogeneity of experience on corporate acquisitions. Administrative Science Quarterly 47: 92–124.
Burt, R.S. 1992. Structural holes: The social structure of competition. Cambridge, MA: Harvard University Press.
Burt, R.S. 2008. Information and structural holes: Comment on Reagans and Zuckerman. Industrial and Corporate Change 17: 953–969.
Casciaro, T., and M.J. Piskorski. 2005. Power imbalance, mutual dependence, and constraint absorption: Resource dependence theory revisited. Administrative Science Quarterly 50: 167–199.
Chung, S., H. Singh, and K. Lee. 2000. Complementarity, status similarity and social capital as drivers of alliance formation. Strategic Management Journal 21: 1–22.
Coleman, J.S. 1990. Foundations of social theory. Cambridge, MA: Harvard University Press.
Davis, G.F. 1991. Agents without principles? The spread of the poison pill through the intercorporate network. Administrative Science Quarterly 36: 583–613.
Davis, G.F., and H.R. Greve. 1997. Corporate elite networks and governance changes in the 1980s. American Journal of Sociology 103: 1–37.
Davis, G.F., M. Yoo, and W.E. Baker. 2003. The small world of the American corporate elite, 1982–2001. Strategic Organization 1: 301–326.
Emerson, R.M. 1962. Power-dependence relations. American Sociological Review 27: 31–41.
Fernandez, R.M., and R.V. Gould. 1994. A dilemma of state power: Brokerage and influence in the national health policy domain. American Journal of Sociology 99: 1455–1491.
Galaskiewicz, J., W. Bielefeld, and M. Dowell. 2006. Networks and organizational growth: A study of community based nonprofits. Administrative Science Quarterly 51: 337–380.
Giddens, A. 1984. The constitution of society: Outline of the theory of structure. Berkeley: University of California Press.
Granovetter, M. 1985. Economic action and social structure: The problem of embeddedness. American Journal of Sociology 91: 481–510.
Greve, H.R. 2009. Bigger and safer: The diffusion of competitive advantage. Strategic Management Journal 30: 1–23.
Greve, H.R., J.A.C. Baum, H. Mitsuhashi, and T. Rowley. 2010. Built to last but falling apart: Cohesion, friction and withdrawal from interfirm alliances. Academy of Management Journal 53: 302–322.
Gulati, R. 1995a. Does familiarity breed trust? The implications of repeated ties for contractual choice in alliances. Academy of Management Journal 38: 85–112.
Gulati, R. 1995b. Social structure and alliance formation patterns: A longitudinal analysis. Administrative Science Quarterly 40: 619–652.
Gulati, R. 2007. Managing network resources: Alliances, affiliations, and other relational assets. Oxford: Oxford University Press.
Gulati, R., and M. Gargiulo. 1999. Where do interorganizational networks come from? American Journal of Sociology 104: 1439–1493.
Gulati, R., and M.C. Higgins. 2003. Which ties matter when? The contingent effects of interorganizational partnerships on IPO success. Strategic Management Journal 24: 127–144.
Gulati, R., and M. Sytch. 2007. Dependence asymmetry and joint dependence in interorganizational relationships: Effects of embeddedness on exchange performance. Administrative Science Quarterly 52: 32–69.
Gulati, R., and M. Sytch. 2008. Does familiarity breed trust? Revisiting the antecedents of trust. Managerial and Decision Economics 29: 165–190.
Gulati, R., and J.D. Westphal. 1999. Cooperative or controlling? The effects of CEO-board relations and the content of interlocks on the formation of joint ventures. Administrative Science Quarterly 44: 473–506.
Gulati, R., D. Lavie, and R. Madhavan. 2011. How do networks matter? The performance effects of interorganizational networks. Research in Organizational Behavior 31: 207–224.
Gulati, R., M. Sytch, and A. Tatarynowicz. 2012. The rise and fall of small worlds: Exploring the evolutionary dynamics of social structure. Organization Science 23: 449–471.
Hage, J., and M. Aiken. 1967. Program change and organizational properties: A comparative analysis. American Journal of Sociology 72: 503–519.
Haunschild, P.R. 1993. Interorganizational imitation: The impact of interlocks on corporate acquisition activity. Administrative Science Quarterly 38: 564–592.
Haunschild, P.R., and C. Beckman. 1998. When do interlocks matter? Alternate sources of information and interlock influence. Administrative Science Quarterly 43: 815–844.
Jensen, M.C. 2003. The role of network resources in market entry: Commercial banks’ entry into investment banking, 1991–1997. Administrative Science Quarterly 48: 466–497.
Jensen, M.C. 2008. The use of relational discrimination to manage market entry: When do social status and structural holes work against you? Academy of Management Journal 51: 723–743.
Kim, J.W., and M.C. Higgins. 2007. Where do alliances come from? The effects of upper echelons on alliance formation. Research Policy 36: 499–514.
Kim, H., R.E. Hoskisson, and W.P. Wan. 2004. Power dependence, diversification strategy, and performance in keiretsu member firms. Strategic Management Journal 25: 613–636.
Kogut, B., and G. Walker. 2001. The small world of Germany and the durability of national networks. American Sociological Review 66: 317–335.
Larson, A. 1992. Network dyads in entrepreneurial settings: A study of the governance of exchange relationships. Administrative Science Quarterly 37: 76–104.
Lavie, D. 2006. The competitive advantage of interconnected firms: An extension of the resource-based view. Academy of Management Review 31: 638–658.
Levinthal, D.A., and M. Fichman. 1988. Dynamics of interorganizational attachments: Auditor–client relationships. Administrative Science Quarterly 33: 345–369.
Li, S.X., and T.J. Rowley. 2002. Inertia and evaluation mechanisms in interorganizational partner selection: Syndicate formation among U.S. investment banks. Academy of Management Journal 45: 1104–1118.
Lincoln, J.M., M.L. Gerlach, and P. Takahashi. 1992. Keiretsu networks in the Japanese economy: A dyad analysis of intercorporate ties. American Sociological Review 57: 561–585.
Madhavan, R., B.R. Koka, and J.E. Prescott. 1998. Networks in transition: How industry events (re)shape interfirm relationships. Strategic Management Journal 19: 439–459.
McEvily, B., and A. Marcus. 2005. Embedded ties and the acquisition of competitive capabilities. Strategic Management Journal 26: 1033–1055.
McEvily, B., and A. Zaheer. 1999. Bridging ties: A source of firm heterogeneity in competitive capabilities. Strategic Management Journal 20: 1133–1156.
McEvily, B., J. Jaffee, and M. Tortoriello. 2012. Not all bridging ties are equal: Network imprinting and firm growth in the Nashville legal industry 1933–1978. Organization Science 23: 547–563.
Mizruchi, M.S. 1992. The structure of corporate political action: Interfirm relations and their consequences. Cambridge, MA: Harvard University Press.
Owen-Smith, J., and W.W. Powell. 2004. Knowledge networks in the Boston biotechnology community. Organization Science 15: 5–21.
Ozdemir, S. 2007. Social balance sheet, social capital and reciprocation in the US VC industry. Paper presented at the Academy of Management conference, Philadelphia. 6 August.
Pfeffer, J., and P. Nowak. 1976. Joint-ventures and interorganizational interdependence. Administrative Science Quarterly 21: 398–418.
Pfeffer, J., and G. Salancik. 1978. The external control of organizations. New York: Harper & Row.
Podolny, J.M. 1993. A status-based model of market competition. American Journal of Sociology 98: 829–872.
Podolny, J.M. 1994. Market uncertainty and the social character of economic exchange. Administrative Science Quarterly 39: 458–483.
Podolny, J.M. 2008. Status signals: A sociological study of market competition. Princeton: Princeton University Press.
Polidoro, F., G. Ahuja, and W. Mitchell. 2011. When the social structure overshadows competing incentives: The effects of network embeddedness on joint venture dissolution. Academy of Management Journal 54: 369–392.
Powell, W.W., K.W. Koput, and L. Smith-Doerr. 1996. Interorganizational collaboration and the locus of innovation: Networks of learning in biotechnology. Administrative Science Quarterly 41: 116–145.
Powell, W.W., D.R. White, K.W. Koput, and J. Owen-Smith. 2005. Network dynamics and field evolution: The growth of interorganizational collaboration in the life sciences. American Journal of Sociology 110: 1132–1205.
Reagans, R., and E. Zuckerman. 2008. Why knowledge does not equal power: The network redundancy trade-off. Industrial and Corporate Change 17: 904–944.
Rosenkopf, L., and G. Padula. 2008. Investigating the microstructure of network evolution: Alliance formation in the mobile communications industry. Organization Science 19: 669–687.
Rosenkopf, L., and M. Tushman. 1998. The coevolution of community networks and technology: Lessons from the flight simulation industry. Industrial and Corporate Change 7: 311–346.
Rowley, T., D. Behrens, and D. Krackhardt. 2000. Redundant governance structures: An analysis of structural and relational embeddedness in the steel and semiconductor industries. Strategic Management Journal 21: 369–386.
Ryall, M.D., and O. Sorenson. 2007. Brokers and competitive advantage. Management Science 53: 566–583.
Schilling, M., and C.C. Phelps. 2007. Interfirm collaboration networks: The impact of large-scale network structure on firm innovation. Management Science 53: 1113–1126.
Shipilov, A. 2006. Network strategies and performance of Canadian investment banks. Academy of Management Journal 49: 590–604.
Shipilov, A.V., and S.X. Li. 2008. To have a cake and eat it too? Structural holes’ influence on status accumulation and market performance in collaborative networks. Administrative Science Quarterly 53: 73–108.
Sorenson, O., and T.E. Stuart. 2001. Syndication networks and the spatial distribution of venture capital investments. American Journal of Sociology 106: 1546–1588.
Sorenson, O., and D.M. Waguespack. 2006. Social structure and exchange: Self-confirming dynamics in Hollywood. Administrative Science Quarterly 51: 560–589.
Stuart, T.E. 2000. Interorganizational alliances and the performance of firms: A study of growth and innovation rates in a high-technology industry. Strategic Management Journal 21: 791–811.
Stuart, T.E., H. Hoang, and R.C. Hybels. 1999. Interorganizational endorsements and the performance of entrepreneurial ventures. Administrative Science Quarterly 44: 215–252.
Sytch, M. 2010. Where do conflictual ties come from? Exploring the role of spatial distribution of principals and mediating agents. Best Paper Proceedings of the Academy of Management Annual conference, Montreal, 9 August.
Sytch, M., and A. Tatarynowicz. 2013. Friends and foes: The dynamics of dual social structures. Academy of Management Journal, forthcoming.
Sytch, M., A. Tatarynowicz, and R. Gulati. 2012. Toward a theory of extended contact: Incentives and opportunities for bridging across network communities. Organization Science 23: 1658–1681.
Tatarynowicz, A., R. Gulati, and M. Sytch. 2013. Individual behaviors and collective outcomes: Capturing the structural and functional variety of collaborative networks across industries. Working paper, Tilburg University.
Uzzi, B. 1997. Social structure and competition in interfirm networks: The paradox of embeddedness. Administrative Science Quarterly 42: 35–67.
Uzzi, B., and J. Spiro. 2005. Collaboration and creativity: The small world problem. American Journal of Sociology 111: 447–504.
Wang, L., and E.J. Zajac. 2007. Alliance or acquisition? A dyadic perspective on interfirm resource combinations. Strategic Management Journal 28: 1291–1317.
Watts, D.J., and S.H. Strogatz. 1998. Collective dynamics of small-world networks. Nature 393: 440–442.
Westphal, J.D., R. Gulati, and S.M. Shortell. 1997. Customization or conformity? An institutional and network perspective on the content and consequences of TQM adoption. Administrative Science Quarterly 42: 366–394.
Zaheer, A., and G.G. Bell. 2005. Benefiting from network position: Firm capabilities, structural holes, and performance. Strategic Management Journal 26: 809–825.
Zaheer, A., and G. Soda. 2009. Network evolution: The origins of structural holes. Administrative Science Quarterly 54: 1–31.
Zaheer, A., E. Hernandez, and S. Banerjee. 2010. Prior alliances with targets and acquisition performance in knowledge-intensive industries. Organization Science 21: 1072–1091.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Copyright information
© 2016 The Author(s)
About this entry
Cite this entry
Sytch, M., Gulati, R. (2016). Markets as Networks. In: Augier, M., Teece, D. (eds) The Palgrave Encyclopedia of Strategic Management. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-94848-2_321-1
Download citation
DOI: https://doi.org/10.1057/978-1-349-94848-2_321-1
Received:
Accepted:
Published:
Publisher Name: Palgrave Macmillan, London
Online ISBN: 978-1-349-94848-2
eBook Packages: Springer Reference Business and ManagementReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences