Bridging Qualitative and Quantitative Methods in Organizational Research: Applications of Synthetic Control Methodology in the U.S. Automobile Industry

Adam R. Fremeth (), Guy L. F. Holburn () and Brian K. Richter ()
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Adam R. Fremeth: Ivey Business School, University of Western Ontario, London, Ontario N6G 0N1, Canada
Guy L. F. Holburn: Ivey Business School, University of Western Ontario, London, Ontario N6G 0N1, Canada
Brian K. Richter: McCombs School of Business, University of Texas at Austin, Austin, Texas 78712

Organization Science, 2016, vol. 27, issue 2, 462-482

Abstract: We assess the utility of synthetic control, a recently developed empirical methodology, for applications in organizational research. Synthetic control acts as a bridge between qualitative and quantitative research methods by enabling researchers to estimate treatment effects in contexts with small samples or few occurrences of a phenomenon or treatment event. The method constructs a counterfactual of a focal firm, or other observational unit, based on an objectively weighted combination of a small number of comparable but untreated firms. By comparing the firm’s actual performance to its counterfactual replica without treatment, synthetic control estimates, under certain assumptions, the magnitude and direction of treatment effects. We illustrate and critique the method in the context of the U.S. auto industry by estimating (a) the effect of government intervention in Chrysler’s management from 2009 to 2011 on its sales volumes and (b) the impact of Toyota’s 2010 “acceleration crisis” on Camry sales.

Keywords: synthetic control; case study research; qualitative methods; automobile industry; government intervention; product recalls (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ororsc:v:27:y:2016:i:2:p:462-482

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