Legitimacy in Adaptive Business Model Innovation: An Investigation of Academic Ebook Platforms in China

Xiaobo Wu, Ziyi Zhao and Banghao Zhou

Emerging Markets Finance and Trade, 2019, vol. 55, issue 4, 719-742

Abstract: The purpose of this research is to investigate the importance and influence of seeking legitimacy from the value network for adaptive business model innovation in emerging markets. Drawing on institutional theory, it is believed that legitimacy can mitigate environmental uncertainties and risks, and help firms to survive and prosper. However, little is known about the role played by legitimacy in firms’ business model innovation. This article introduces the concept of legitimacy to examine how adaptive business model innovation responding to exogenous threats in emerging markets. By using the framework of value network, we employ comparative case studies of three foreign academic ebook platforms in China and investigate two types of adaptive business model innovation driven by legitimacy needs. Furthermore, we elucidate regulative, normative, and cognitive legitimacy in business model innovation and trace its origins, including regulatory authorities, partners, customers, and, in some cases, parent companies. Finally, we relate legitimacy seeking to adaptive business model innovation and elaborate on the process of how legitimacy needs motivate adaptive business model innovation, which would defend firms’ survival and growth in emerging markets.

Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:mes:emfitr:v:55:y:2019:i:4:p:719-742

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DOI: 10.1080/1540496X.2018.1429261

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