Diversification and Diffusion: A Social Networks and Institutionalism Perspective
نویسندگان
چکیده
We examine the diffusion of one particular kind of firm strategy, diversification, among a population of Chinese listed firms during the period of 1991 to 2002. The results are consistent with the idea that the decision is driven by both efficiency and legitimacy concerns. By linking diversification to social network and institutionalism theory, this study sheds new light on how dissemination and legitimization processes unfold at the firm level of analysis to influence a major strategic decision such as the level of a firm’s diversification. From the results, we suggest that diversification is not only a response to economic and agency concerns, but also a function of the social context in which a firm is imbedded.
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