IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v23y2002i4-5p187-207.html
   My bibliography  Save this article

The role of irreversibilities in competitive interaction: behavioral considerations from organization theory

Author

Listed:
  • Ming-Jer Chen

    (Darden Graduate School of Business, University of Virginia, USA)

  • S. Venkataraman

    (Darden Graduate School of Business, University of Virginia, USA)

  • Sylvia Sloan Black

    (School of Business and Economics, North Carolina Agricultural and Technical State University, USA)

  • Ian C. MacMillan

    (The Wharton School, University of Pennsylvania, USA)

Abstract

Using behavioral insights from organization theory, this paper examines the significance of the irreversibility of an attacker's competitive move in interfirm competitive interaction. The study suggested that irreversibility is a multifaceted construct that is broadly composed of two dimensions: internal commitment (which is based on organizational inertia) and public commitment (which is based on the degree of publicity or public exposure received). It hypothesized that these two irreversibilities would have opposite effects on competitors' responses. The hypotheses were tested with data on competitive moves and countermoves exchanged by major US airlines. As predicted, the results reveal that internal commitment tended to reduce the likelihood of response, increased the response delay, and decreased the probability that the initial move will be matched; on the contrary, the impacts of public commitment were exactly the opposite. Copyright © 2002 John Wiley & Sons, Ltd.

Suggested Citation

  • Ming-Jer Chen & S. Venkataraman & Sylvia Sloan Black & Ian C. MacMillan, 2002. "The role of irreversibilities in competitive interaction: behavioral considerations from organization theory," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 23(4-5), pages 187-207.
  • Handle: RePEc:wly:mgtdec:v:23:y:2002:i:4-5:p:187-207
    DOI: 10.1002/mde.1061
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1002/mde.1061
    File Function: Link to full text; subscription required
    Download Restriction: no

    File URL: https://libkey.io/10.1002/mde.1061?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Ian MacMillan & Mary Lynn McCaffery & Gilles Van Wijk, 1985. "Competitors' responses to easily imitated new products—exploring commercial banking product introductions," Strategic Management Journal, Wiley Blackwell, vol. 6(1), pages 75-86, January.
    2. Javier Gimeno & Carolyn Y. Woo, 1996. "Hypercompetition in a Multimarket Environment: The Role of Strategic Similarity and Multimarket Contact in Competitive De-Escalation," Organization Science, INFORMS, vol. 7(3), pages 322-341, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yang, Shu-Jung Sunny & Anderson, Edward James, 2014. "Competition through capacity investment under asymmetric existing capacities and costs," European Journal of Operational Research, Elsevier, vol. 237(1), pages 217-230.
    2. Thomas Hutzschenreuter & Florian Gröne, 2009. "Changing Vertical Integration Strategies under Pressure from Foreign Competition: The Case of US and German Multinationals," Journal of Management Studies, Wiley Blackwell, vol. 46(2), pages 269-307, March.
    3. Dastidar, Krishnendu Ghosh & Mukherjee, Diganta, 2014. "Corruption in delegated public procurement auctions," European Journal of Political Economy, Elsevier, vol. 35(C), pages 122-127.
    4. Christian Hofer & Jordan M. Barker & Laura D'Oria & Jonathan L. Johnson, 2022. "Broadening our understanding of interfirm rivalry: A call for research on how supply networks shape competitive behavior and performance," Journal of Supply Chain Management, Institute for Supply Management, vol. 58(2), pages 8-25, April.
    5. Sandra A. Vannoy & A. F. Salam, 2010. "Managerial Interpretations of the Role of Information Systems in Competitive Actions and Firm Performance: A Grounded Theory Investigation," Information Systems Research, INFORMS, vol. 21(3), pages 496-515, September.
    6. Barker, Jordan M. & Gibson, Andrew R. & Hofer, Adriana R. & Hofer, Christian & Moussaoui, Issam & Scott, Marc A., 2021. "A competitive dynamics perspective on the diversification of third-party logistics providers’ service portfolios," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 146(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ming-Jer Chen, 2018. "Scholarship-practice “oneness” of an academic career: The entrepreneurial pursuit of an expansive view of management scholarship," Asia Pacific Journal of Management, Springer, vol. 35(4), pages 859-886, December.
    2. Anna Minà & Giovanni Battista Dagnino & Gianluca Vagnani, 2020. "An interpretive framework of the interplay of competition and cooperation," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 24(1), pages 1-35, March.
    3. Faouzi Bensebaa, 2003. "La dynamique concurrentielle:défis analytiques et méthodologiques," Revue Finance Contrôle Stratégie, revues.org, vol. 6(1), pages 5-37, March.
    4. John Morgan & Felix Várdy, 2013. "The Fragility of Commitment," Management Science, INFORMS, vol. 59(6), pages 1344-1353, June.
    5. Chen, Tianxu & Tribbitt, Mark A. & Yang, Yi & Li, Xiaomei, 2017. "Does rivals' innovation matter? A competitive dynamics perspective on firms' product strategy," Journal of Business Research, Elsevier, vol. 76(C), pages 1-7.
    6. Arindam Banerjee & Tanushri Banerjee, 2017. "Determinants of Analytics Process Adoption in Emerging Economies: Perspectives from the Marketing Domain in India," Vikalpa: The Journal for Decision Makers, , vol. 42(2), pages 95-110, June.
    7. Pham, Tho & Talavera, Oleksandr & Yang, Junhong, 2016. "Multimarket Competition and Profitability: Evidence from Ukrainian banking," MPRA Paper 72376, University Library of Munich, Germany.
    8. Ajay Kalra & Surendra Rajiv & Kannan Srinivasan, 1998. "Response to Competitive Entry: A Rationale for Delayed Defensive Reaction," Marketing Science, INFORMS, vol. 17(4), pages 380-405.
    9. Milorad M. Novicevic & M. Ronald Buckley & Michael G. Harvey, 2000. "The Changing Role of Managers within the Supply Chain Networks: Theory and Practical Implications," American Journal of Business, Emerald Group Publishing, vol. 15(2), pages 33-42.
    10. Da Mota de Pina E Cunha, A.M., 1998. "Determinants of Product Innovation in Organizations : Practices and Performance in the Portugese Financial Sector," Other publications TiSEM e6e4e56e-b72a-4392-8d79-f, Tilburg University, School of Economics and Management.
    11. Murakami, Hideki & Asahi, Ryota, 2011. "Multimarket Contact And Market Power: A Case Of The U.S. Airline Industry," Hitotsubashi Journal of commerce and management, Hitotsubashi University, vol. 45(1), pages 81-88, October.
    12. Brian T. McCann & Mona Bahl, 2017. "The influence of competition from informal firms on new product development," Strategic Management Journal, Wiley Blackwell, vol. 38(7), pages 1518-1535, July.
    13. Kocaman, Barış & Gelper, Sarah & Langerak, Fred, 2023. "Till the cloud do us part: Technological disruption and brand retention in the enterprise software industry," International Journal of Research in Marketing, Elsevier, vol. 40(2), pages 316-341.
    14. Boisot, Max H., 1995. "Is your firm a creative destroyer? Competitive learning and knowledge flows in the technological strategies of firms," Research Policy, Elsevier, vol. 24(4), pages 489-506, July.
    15. Samina Karim & Chi‐Hyon Lee & Manuela N. Hoehn‐Weiss, 2023. "Task bottlenecks and resource bottlenecks: A holistic examination of task systems through an organization design lens," Strategic Management Journal, Wiley Blackwell, vol. 44(8), pages 1839-1878, August.
    16. Harvey, Michael G. & Richey, R. Glenn, 2001. "Global supply chain management: The selection of globally competent managers," Journal of International Management, Elsevier, vol. 7(2), pages 105-128.
    17. Köhler, Christian & Sofka, Wolfgang & Grimpe, Christoph, 2009. "Selectivity in search strategies for innovation: from incremental to radical, from manufacturing to services," ZEW Discussion Papers 09-066, ZEW - Leibniz Centre for European Economic Research.
    18. Junho Yang & Tetsuya Kawamura & Kazuhito Ogawa, 2016. "Experimental Multimarket Contact Inhibits Cooperation," Metroeconomica, Wiley Blackwell, vol. 67(1), pages 21-43, February.
    19. Chih-Yi, Su & Bou-Wen, Lin, 2021. "Attack and defense in patent-based competition: A new paradigm of strategic decision-making in the era of the fourth industrial revolution," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    20. Yahua Zhang & David Round, 2009. "Policy Implications of the Effects of Concentration and Multimarket Contact in China’s Airline Market," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 34(4), pages 307-326, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:23:y:2002:i:4-5:p:187-207. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.