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Unmixed signals: How reputation and status affect alliance formation
Author(s) -
Stern Ithai,
Dukerich Janet M.,
Zajac Edward
Publication year - 2014
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.2116
Subject(s) - reputation , interdependence , alliance , congruence (geometry) , affect (linguistics) , business , panel data , marketing , industrial organization , business administration , psychology , social psychology , economics , political science , econometrics , law , communication
We analyze how incumbents in technology‐driven industries are influenced by founders' reputation and status when considering strategic alliances with newly emerging firms. We theorize that reputation and status represent two distinct components of perceived quality that exert independent and interdependent effects on alliance formation. Using literature on impression formation processes to derive predictions of signal congruence, we argue that the independent effects of reputation and status are amplified when the two are congruent, and that the effect of negative congruence (both reputation and status are low) is stronger than positive congruence (both are high). We find support for our arguments based on panel data on alliances between pharma and biotech firms, using data on biotech scientists' research output (reputation) and university attended (status) . Copyright © 2013 John Wiley & Sons, Ltd.