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Resistance to Change

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  • Dow, James
  • Perotti, Enrico

Abstract

Established firms often fail to maintain leadership following disruptive market shifts. We argue that such firms are more prone to internal resistance. A radical adjustment of assets affects the distribution of employee rents, creating winners and losers. Losers resist large changes when strong customer goodwill cushions the consequences. Partial adaptation may lead winners to depart to form new firms with no goodwill, but no internal resistance.

Suggested Citation

  • Dow, James & Perotti, Enrico, 2010. "Resistance to Change," Institutions and Markets Papers 60752, Fondazione Eni Enrico Mattei (FEEM).
    • Handle: RePEc:ags:feemim:60752
    DOI: 10.22004/ag.econ.60752
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    References listed on IDEAS

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    Cited by:

    1. Cronin, Hugh & McGuinness, Seamus, 2014. "Examining the Relationship between Employee Resistance to Changes in Job Conditions and Wider Organisational Change: Evidence from Ireland," IZA Discussion Papers 8441, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Risk and Uncertainty;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory

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