Too Much of a Good Thing? The Dual Effect of Public Sponsorship on Organizational Performance

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Too Much of a Good Thing? The Dual Effect of Public Sponsorship on Organizational Performance

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Too Much of a Good Thing? The Dual Effect of Public Sponsorship on Organizational Performance

Julien Jourdan¹, Ilze Kivleniece²•Institutions (2)

01 Jan 2017-Research Papers in Economics (HAL)-

TL;DR: In this paper, a U-shaped relationship between the amount of public sponsorship received and the market performance of sponsored organizations was found to be moderated by the breadth, depth and focus of the focal organization's resource accumulation and allocation patterns.

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Abstract: Existing research provides contradictory insights on the effect of public sponsorship on the market performance of organizations. We develop the nascent theory on sponsorship by highlighting the dual and contingent nature of the relationship between public sponsorship and market performance. By arguing that sponsorship differentially affects resource accumulation and allocation mechanisms, we suggest two opposing firm-level effects, leading to an inverted U-shaped relationship between the amount of public sponsorship received and the market performance of sponsored organizations. This non-linear relationship, we argue, is moderated by the breadth, depth and focus of the focal organization's resource accumulation and allocation patterns. While horizontal scope (i.e. increased breadth) and externally oriented resource profile (i.e. reduced depth) strengthen the relationship, market orientation (i.e. increased focus) attenuates it. We test and find strong support for our hypotheses using population data on French film production firms from 1998 to 2008. Our work highlights the performance trade-offs associated with public sponsorship, and carries important managerial and policy implications.

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Creativity in Context: Update to "The Social Psychology of Creativity"

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William J. Lyddon

01 Jan 1998-contemporary Psychology

914 citations

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Creating and Capturing Value in Public-Private Ties: A Private Actor's Perspective

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Ilze Kivleniece¹, Bertrand Quelin¹•Institutions (1)

HEC Paris¹

01 Apr 2012-Research Papers in Economics

TL;DR: The authors identify the value creation and capture mechanisms embedded in these ties through a theoretical framework of two conceptual public-private structural alternatives, each associated with different value-creating capacities, rationales, and outcomes.

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Abstract: Intersecting the boundaries of public and private economic activity, public-private ties carry important organizational strategy, management, and policy implications. We identify the value creation and capture mechanisms embedded in these ties through a theoretical framework of two conceptual public-private structural alternatives, each associated with different value-creating capacities, rationales, and outcomes. Two important restraints on private value capture--public partner opportunism and external stakeholder activism--arise asymmetrically under each form, carrying a critical effect on partnership outcomes.

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217 citations

Journal Article•DOI•

Government's green grip: Multifaceted state influence on corporate environmental actions in China

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Ruxi Wang¹, Frank Wijen², Pursey P. M. A. R. Heugens²•Institutions (2)

Renmin University of China¹, Erasmus University Rotterdam²

01 Feb 2018-Strategic Management Journal

TL;DR: The influence of the Chinese state at multiple levels on the environmental actions of publicly listed firms is examined to conclude that state influence on corporate environmental actions in China is multifaceted and subject to “policy‐policy decoupling.”

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Abstract: Research summary: Emerging economies such as China enjoy economic expansion, but also face dramatic environmental challenges. China's government is a central actor in both stimulating economic activities and pursuing environmental protection. Drawing on panel data and in-depth interviews, we examined the influence of the Chinese state at multiple levels on the environmental actions of publicly listed firms. The results show that corporate environmental actions follow an inverted U-shape as control of environmental practices moves from the central government to the most decentral administrative level. This curvilinear relationship is positively moderated by the stringency of environmental regulation and negatively moderated by environmental monitoring capacity. We conclude that state influence on corporate environmental actions in China is multifaceted and subject to "policy-policy decoupling." Managerial summary: As China's environmental awareness is growing, the country's government is increasingly concerned with the question as to how it can improve the environmental performance of the firms it controls. Our evidence shows the concurrence of two contravening government influences on corporate environmental practices: a performance-enhancing effect of the regulatory pressure by multiple authorities and a performance-diminishing effect of the autonomy enjoyed by local governments. Both the most centrally and the most decentrally controlled firms in China show significantly weaker environmental performance than those controlled by intermediary levels of government. The stringency of sectorial environmental regulation and environmental monitoring capacity affect the strength of the Chinese government's green grip.

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208 citations

Cites background from "Too Much of a Good Thing? The Dual ..."

...We expect that both the mounting pressure and increasing autonomy effects associated with environmental actions will be intensified by the stringency of environmental regulation, resulting in a steepened inverted U-shaped relationship (cf. Jourdan & Kivleniece, 2017)....
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Journal Article•DOI•

The distinct signaling effects of R&D subsidy and non-R&D subsidy on IPO performance of IT entrepreneurial firms in China

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Jin Chen¹, Cheng Suang Heng², Bernard C. Y. Tan², Zhijie Lin³•Institutions (3)

East China University of Science and Technology¹, National University of Singapore², Nanjing University³

01 Feb 2018-Research Policy

TL;DR: In this article, the authors investigated how R&D subsidy and non-R&D subsidies affect entrepreneurial firms' initial public offering (IPO) performance in an emerging economy like China.

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99 citations

Journal Article•DOI•

Do more subsidies promote greater innovation? Evidence from the Chinese electronic manufacturing industry

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Dayong Liu¹, Tong Chen¹, Xiaoyang Liu¹, Yongze Yu²•Institutions (2)

College of Management and Economics¹, Nanjing University of Finance and Economics²

01 Aug 2019-Economic Modelling

TL;DR: In this article, an inverted U-shaped relationship between the amount of subsidies and four indicators of technology innovation was investigated, leading to three effects: resource allocation, information efficiency, risk control and regional economic development.

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79 citations

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References

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Journal Article•DOI•

The External Control of Organizations: A Resource Dependence Perspective.

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Robert N. Stern, Jeffrey Pfeffer, Gerald R. Salancik

01 Jul 1979-Contemporary Sociology

12,500 citations

"Too Much of a Good Thing? The Dual ..." refers background in this paper

...…provision, sponsorship operates outside value-based market exchange mechanisms, implying that the constraints associated with external resource provision, as well as the bargaining power of the resource provider are substantially reduced (Casciaro & Piskorski, 2005; Pfeffer & Salancik, 2003)....
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Journal Article•DOI•

Production, Information Costs, and Economic Organization

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Armen A. Alchian, Harold Demsetz

01 Jun 1975-IEEE Engineering Management Review

8,910 citations

"Too Much of a Good Thing? The Dual ..." refers background in this paper

...Without price, residual or other value-based claims tied to external resource influx, the information and incentives of economic markets are likely to be largely obstructed (Alchian & Demsetz, 1972; Kim & Mahoney, 2010; Perry & Rainey, 1988)....
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Posted Content•

Production, information costs, and economic organization

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Armen A. Alchian, Harold Demsetz

01 Jan 1972-The American Economic Review

TL;DR: In this paper, the authors present a set of reprint articles for which IEEE does not hold copyright. Full text is not available on IEEE Xplore for these articles, but full text can be found on the Internet Archive.

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Abstract: This publication contains reprint articles for which IEEE does not hold copyright. Full text is not available on IEEE Xplore for these articles.

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8,513 citations

Journal Article•DOI•

Asset stock accumulation and sustainability of competitive advantage

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Ingemar Dierickx¹, Karel Cool¹•Institutions (1)

INSEAD¹

01 Dec 1989-Management Science

TL;DR: Barney as mentioned in this paper showed that the sustainability of a firm's asset position depends on how easily assets can be substituted or imitated, and that imitability is linked to the characteristics of the asset accumulation process: time compression diseconomies, asset mass efficiencies, interconnectedness, asset erosion and causal ambiguity.

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Abstract: Given incomplete factor markets, appropriate time paths of flow variables must be chosen to build required stocks of assets. That is, critical resources are accumulated rather than acquired in "strategic factor markets" Barney [Barney, J. 1986. Strategic factor markets: Expectations, luck, and business strategy. Management Sci. October 1231-1241.]. Sustainability of a firm's asset position hinges on how easily assets can be substituted or imitated. Imitability is linked to the characteristics of the asset accumulation process: time compression diseconomies, asset mass efficiencies, inter-connectedness, asset erosion and causal ambiguity.

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8,271 citations

"Too Much of a Good Thing? The Dual ..." refers background in this paper

...…theoretical distinction between resource allocation and accumulation as critical mechanisms of organizational resource construction and deployment (Dierickx & Cool, 1989; Helfat & Peteraf, 2003; Lazzarini, 2015), we argue that the conflicting insights on the impact of sponsorship can be untangled…...
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...Corresponding to resource “stocks” and “flows”, these dual resource management mechanisms influence the sustainability of organization’s competitive advantage and performance (Dierickx & Cool, 1989)....
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...…buffering effects, while internal resource accumulation may be disadvantaged by time-compression diseconomies due to costly internal development (Dierickx & Cool, 1989; Pacheco-de-Almeida & Zemsky, 2007), hindering the build-up of a resource “buffer” and lowering the “isolating” effect of…...
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...Building on resource accumulation and resource allocation as two distinct mechanisms of organizational resource construction and deployment (Dierickx & Cool, 1989; Helfat & Peteraf, 2003; Lazzarini, 2015), we propose a nonlinear, contingency-based model of sponsorship effects on performance....
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...…an influx of sponsored resources permits a more rapid resource stock buildup, particularly for valuable, hard-to-imitate external resources, and avoids potential “time compression diseconomies” associated with resource imitation internally (Dierickx & Cool, 1989; Pacheco-de-Almeida & Zemsky, 2007)....
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Journal Article•DOI•

The capabilities of market-driven organizations

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George S. Day¹•Institutions (1)

University of Pennsylvania¹

01 Oct 1994-Journal of Marketing

Abstract: Considerable progress has been made in identifying market-driven businesses, understanding what they do, and measuring the bottom-line consequences of their orientation to their markets. The next c...

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6,313 citations

"Too Much of a Good Thing? The Dual ..." refers background in this paper

...…possession of dynamic capabilities that enable better understanding of customer expressed and latent needs, delivery of superior solutions to such needs (Hult et al., 2005; Ketchen et al., 2007; Slater & Narver, 1999), and their integration in the strategic decision-making process (Day, 1994)....
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..., 2007; Slater & Narver, 1999), and their integration in the strategic decision-making process (Day, 1994)....
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