Vertical vs. Horizontal: How Strategic Alliance Type Influence Firm Performance?

Baojun Yu, Hangjun Xu and Feng Dong
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Baojun Yu: Department of Management Science and Engineering, School of Management, Jilin University, Changchun 130022, China
Hangjun Xu: Department of Marketing, McAfee School of Business, Union University, Jackson, TN 38305, USA
Feng Dong: Department of Finance, School of Business, Siena College, Loudonville, NY 12211, USA

Sustainability, 2019, vol. 11, issue 23, 1-14

Abstract: Strategic alliances have become a key focus in the management and marketing literature. However, much of the previous research in this area has focused on the antecedents and accounting effects of strategic alliances. There is an opportunity to more closely examine how alliance types might influence the public equity markets. As a result, this study summarizes the literature for the theoretical foundation of strategic alliances to increase the understanding of the two main types of strategic alliances, that is industry scope (vertical vs. horizontal alliances) and size scope (asymmetric vs. symmetric alliances). Then, this study proposes a conceptual framework to examine the main and relative effects between different types of strategic alliances and firm performance. Using the Bloomberg Mergers and Acquisitions (M&A) database from 1 January 2010 to 1 January 2016, we find that vertical symmetric alliances gain more abnormal returns than others. Finally, implications and limitations are also discussed.

Keywords: asymmetric alliances; average abnormal return; horizontal alliances; strategic alliances; symmetric alliances; vertical alliances (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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