Alliance Strategies of Small Firms

Alliance Strategies of Small Firms The paper concludes that small firms follow one of two alliance strategies. When the firms are small relative to their rivals and to their market, they tend to use alliances to gain economies of scale and scope; when they are large in relative terms, they avoid alliances. This behavior is consistent with alliance usage by large firms. The paper also analyzes the sources of profit for a small firm that uses a "constellation" of allies to compete in a scale-intensive industry. Its profits depend on a combination of the group-based advantages generated by the constellation, and the share of these profits that the firm can appropriate from the group. Small firms face particular hazards in this regard when their bargaining power within their constellation is weak. The paper illustrates these arguments with data froma small survey, with case studies from the computer industry, and with a simple mathematical model. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Small Business Economics Springer Journals

Alliance Strategies of Small Firms

Loading next page...
 
/lp/springer_journal/alliance-strategies-of-small-firms-DkLqhWYPqM
Publisher
Kluwer Academic Publishers
Copyright
Copyright © 1997 by Kluwer Academic Publishers
Subject
Business and Management; Management; Microeconomics; Entrepreneurship; Industrial Organization
ISSN
0921-898X
eISSN
1573-0913
D.O.I.
10.1023/A:1007947629435
Publisher site
See Article on Publisher Site

Abstract

The paper concludes that small firms follow one of two alliance strategies. When the firms are small relative to their rivals and to their market, they tend to use alliances to gain economies of scale and scope; when they are large in relative terms, they avoid alliances. This behavior is consistent with alliance usage by large firms. The paper also analyzes the sources of profit for a small firm that uses a "constellation" of allies to compete in a scale-intensive industry. Its profits depend on a combination of the group-based advantages generated by the constellation, and the share of these profits that the firm can appropriate from the group. Small firms face particular hazards in this regard when their bargaining power within their constellation is weak. The paper illustrates these arguments with data froma small survey, with case studies from the computer industry, and with a simple mathematical model.

Journal

Small Business EconomicsSpringer Journals

Published: Sep 29, 2004

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 12 million articles from more than
10,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Unlimited reading

Read as many articles as you need. Full articles with original layout, charts and figures. Read online, from anywhere.

Stay up to date

Keep up with your field with Personalized Recommendations and Follow Journals to get automatic updates.

Organize your research

It’s easy to organize your research with our built-in tools.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve Freelancer

DeepDyve Pro

Price
FREE
$49/month

$360/year
Save searches from Google Scholar, PubMed
Create lists to organize your research
Export lists, citations
Read DeepDyve articles
Abstract access only
Unlimited access to over
18 million full-text articles
Print
20 pages/month
PDF Discount
20% off