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The case for formal theory

August 7th, 2009 | Posted by admin in 2009 - (0 Comments)

Ron Adner, Laszlo Polos, Michael D. Ryall, and Olav Sorenson

This special topic forum contains seven papers that illustrate many of the ways in which management researchers can use formal tools–mathematical methods, simulation, and formal logic–to develop management research. Here we offer an overview of these methods and their advantages as tools for research.

Academy of Management Review, 34 (2009): 201-208

The mobilization of scarce resources

August 7th, 2009 | Posted by admin in 2008 - (0 Comments)

Bjørn Løvås and Olav Sorenson

We examine how the ability of one actor to gain access to resources controlled by another depends on two factors: (i) the number of mutual acquaintances connecting the prospective lender and borrower and (ii) the scarcity of the resources in question. We argue that the incentives to renege on an agreement grow as the resources being traded become increasingly scarce. Mutual acquaintances, however, dampen these incentives, and therefore become more important to facilitating exchange as demand for the good of interest rises. Our analysis of qualitative and quantitative evidence from a study of senior partners at an international consultancy supports these propositions.

Advances in Strategic Management, 25: 361-389

Brokers and competitive advantage

August 7th, 2009 | Posted by admin in 2007 - (0 Comments)

Michael D. Ryall and Olav Sorenson

The broker profits by intermediating between two (or more) parties. Using a biform game, we examine whether such a position can confer a competitive advantage, as well as whether any such advantage could persist if actors formed relations strategically. Our analysis reveals that, if one considers exogenous the relations between actors, brokers can enjoy an advantage but only if (1) they do not face substitutes either for the connections they offer or the value they can create, (2) they intermediate more than two parties, and (3) interdependence does not lock them into a particular pattern of exchange. If, on the other hand, one allows actors to form relations on the basis of their expectations of the future value of those relations, then profitable positions of intermediation only arise under strict assumptions of unilateral action. We discuss the implications of our analysis for firm strategy and empirical research.

Management Science, 53 (2007): 566-583