Organizations enter alliances with each other to access critical re‐sources, but they rely on information from the network of prior alli‐ances to determine with whom to cooperate. These new alliances modify the existing network, prompting an endogenous dynamic be‐tween organizational action and network structure that drives the emergence of interorganizational networks. Testing these ideas on alliances formed in three industries over nine years, this research shows that the probability of a new alliance between specific organi‐zations increases with their interdependence and also with their prior mutual alliances, common third parties, and joint centrality in the alliance network. The differentiation of the emerging network structure, however, mitigates the effect of interdependence and en‐hances the effect of joint centrality on new alliance formation.

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Where Do Interorganizational Networks Come From

Social Structure and Alliance Formation Patterns: A Longitudinal Analysis

This paper presents a dynamic, firm-level study of the role of network resources in determining alliance formation. Such resources inhere not so much within the firm but reside in the interfirm networks in which firms are placed. Data from extensive fieldwork show that by influencing the extent to which firms have access to information about potential partners, such resources are an important catalyst for new alliances, especially because alliances entail considerable hazards. This study also assesses the importance of firms’ capabilities with alliance formation and material resources as determinants of their alliance decisions. I test this dynamic framework and its hypotheses about the role of time-varying network resources and firm capabilities with comprehensive longitudinal multi-industry data on the formation of strategic alliances by a panel of firms between 1970 and 1989. The results confirm field observations that accumulated network resources arising from firm participation in the network of accumulated prior alliances are influential in firms’ decisions to enter into new alliances. This study highlights the importance of network resources that firms derive from their embeddedness in networks for explaining their strategic behavior. Copyright © 1999 John Wiley & Sons, Ltd.

Network location and learning: the influence of network resources and firm capabilities on alliance formation

Despite widespread agreement among organizational researchers that intangible resources underlie performance differences among organizations, little empirical evidence exists in the literature. Building on the idea that reputation is socially constructed, this paper depicts reputation as the outcome of the process of legitimation. It observes that organizational researchers have overlooked how certification contests legitimate organizations, generate status orderings, and create favorable reputations. This paper suggests that victories in certification contests are credentials that enable firms to acquire a reputation for competence. It predicts that cumulative victories improve the survival of organizations and better the life chances of startup organizations more than those of lateral entries. These predictions are analyzed in the American auto industry during 1895–1912 when special-purpose product rating agencies were absent and reliability and speed contests served as credentialing devices. The results show that cumulative victories in contests extend the life chances of winning organizations but there is no evidence that new startup organizations benefit more than lateral entries. These findings underscore the significance of intangible assets and point to the need for an institutionally informed theory of competences.

https://www.jstor.org/stable/pdfplus/2486809.pdf

The Social Construction of Reputation: Certification Contests, Legitimation, and the Survival of Organizations in the American Automobile Industry: 1895–1912

Institutional Embeddedness and the Dynamics of Organizational Populations

Density Dependence in Organizational Mortality: Legitimacy or Unobserved Heterogeneity?

This article elaborates the results found in Petersen (1991) by discussing how to minimize time-aggregation bias in hazard-rate models with measured covariates. It first considers a model with a single categorical covariate with h categories. It derives analytically the bias of the estimator that assumes the durations are exactly measured, when the durations are in fact rounded up to the nearest integer. Second, the article conducts both large-and small-sample Monte Carlo studies for several estimators of the covariate effects in the presence of time aggregation. There are three central findings. (1) It is shown that the likelihood that adjusts for the grouped nature of the duration measures recaptures the parameters very well. (2) The estimator that assumes that the durations are exactly measured, when they in fact are rounded up to the nearest integer, is biased in several ways. (3) The estimator that uses the midpoint adjustment suffers from the same weaknesses as the estimator that rounds up to the ne...

Time-Aggregation Bias in Hazard-Rate Models with Covariates

Hannan, Barron, and Carroll (henceforward HBC) have presented two sets of simulations that they claim show the results in our paper to lack robustness. In their first set of simulations, once organizational age was controlled unobserved heterogeneity produced spurious negative density dependence in only 3 of 10 replications. Therefore, they have claimed that our results are not robust and are unusual, even under the structure we assumed. It usually takes 30-40 replications to establish the robustness of a result the number needed to assess the distribution of the estimator across samples assuming the distribution to be normal (as we and HBC do). Due to constraints on computer resources we were unable to undertake this many replications (see note 14 in our paper). However, if we accept HBC's estimate that one would make the incorrect inference in 3 of 10 cases, it is still uncertain whether the glass is three-tenths full or seven-tenths empty. Under the true null hypothesis i.e., no effect of density on the mortality rate HBC's KENNETH W. KopuT University of California, Berkeley

http://www.jstor.org/stable/pdfplus/2096114.pdf

Kenneth W. Koput

Papers

Density Dependence in Organizational Mortality: Legitimacy or Unobserved Heterogeneity?

Time-Aggregation Bias in Hazard-Rate Models with Covariates

Unobserved Heterogeneity or Legitimacy in Density Dependence: A Rejoinder to Hannan, Barron, and Carroll