 Governance Mechanisms, Prior International Diversification and Organizational Inertia: A Longitudinal Test of Large United States FirmsPol Herrman, Sergio Lence and Sanjeev Agarwal Staff General Research Papers Archive from Iowa State University, Department of Economics Abstract: We draw from agency theory and take into account organizational inertia to argue that, over time, firms determine their future international strategy based on the level of current strategy because their commitments and investments become institutionalized into daily routines, lessening decision makers' influence. We analyze a data set of 123 firms over the years 1991, 1994, 1997, and 2000 by use of the generalized method of moments, a dynamic panel estimation method, which reduces the probability of presenting inconsistent and biased findings and avoids problems of endogeneity. Results strongly support the argument based on organizational-inertia perspective that the level of international diversification in large U.S. firms is primarily a function of their previous levels of international diversification. Keywords: inertia; international diversification; international strategy (search for similar items in EconPapers) Published in International Journal of Management , December 2011, vol. 28 no. 4, pp. 106-118 There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:isu:genres:34996 Access Statistics for this paper More papers in Staff General Research Papers Archive from Iowa State University, Department of Economics Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070. Contact information at EDIRC. |
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