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Does it pay to be different? Competitive non-conformity under different regulatory regimes

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  • Norman, Patricia M.
  • Artz, Kendall W.
  • Martinez, Richard J.

Abstract

This paper examines how non-conformity in a firm's competitive actions as compared to its rivals impacts firm performance. While a firm may realize some performance benefits from actions that differentiate it from rivals, institutional norms place limits on these benefits. We examine how one institutional constraint, the degree of regulation, affects the relationship between competitive non-conformity and performance. The degree of regulation is a key factor in determining the extent to which firms can engage in, and benefit from, unconventional actions. However, little research has examined this issue. Drawing from the competitive dynamics and institutional literature, we develop and test a model using longitudinal data from the U.S. airline industry during both regulated and deregulated periods. Our prediction of a curvilinear effect of non-conformity was supported in the regulated period, but not the deregulated period. Particularly notable are the results showing that regulation is a critical determinant of both firm behaviors and the outcomes associated with non-conforming actions.

Suggested Citation

  • Norman, Patricia M. & Artz, Kendall W. & Martinez, Richard J., 2007. "Does it pay to be different? Competitive non-conformity under different regulatory regimes," Journal of Business Research, Elsevier, vol. 60(11), pages 1135-1143, November.
    • Handle: RePEc:eee:jbrese:v:60:y:2007:i:11:p:1135-1143
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    References listed on IDEAS

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    Cited by:

    1. Jennings, Jennifer E. & Jennings, P. Devereaux & Greenwood, Royston, 2009. "Novelty and new firm performance: The case of employment systems in knowledge-intensive service organizations," Journal of Business Venturing, Elsevier, vol. 24(4), pages 338-359, July.
    2. Hughes-Morgan, Margaret & Kolev, Kalin & Mcnamara, Gerry, 2018. "A meta-analytic review of competitive aggressiveness research," Journal of Business Research, Elsevier, vol. 85(C), pages 73-82.
    3. Tan, Justin & Shao, Yunfei & Li, Wan, 2013. "To be different, or to be the same? An exploratory study of isomorphism in the cluster," Journal of Business Venturing, Elsevier, vol. 28(1), pages 83-97.
    4. Hai Guo & Jintong Tang & Zhongfeng Su, 2014. "To be different, or to be the same? The interactive effect of organizational regulatory legitimacy and entrepreneurial orientation on new venture performance," Asia Pacific Journal of Management, Springer, vol. 31(3), pages 665-685, September.
    5. van Werven, Ruben & Bouwmeester, Onno & Cornelissen, Joep P., 2015. "The power of arguments: How entrepreneurs convince stakeholders of the legitimate distinctiveness of their ventures," Journal of Business Venturing, Elsevier, vol. 30(4), pages 616-631.
    6. Daft, Jost & Albers, Sascha, 2015. "An empirical analysis of airline business model convergence," Journal of Air Transport Management, Elsevier, vol. 46(C), pages 3-11.
    7. Nair, Anil & Selover, David D., 2012. "A study of competitive dynamics," Journal of Business Research, Elsevier, vol. 65(3), pages 355-361.
    8. Blake E. Ashforth & Kristie M. Rogers & Kevin G. Corley, 2011. "Identity in Organizations: Exploring Cross-Level Dynamics," Organization Science, INFORMS, vol. 22(5), pages 1144-1156, October.

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