What determines alliance longevity? Searching for Answers in Transaction Cost Economics and the Dynamic Capabilities Perspective


This working paper was presented by Dr. Noushi Rahman of the Lubin School of Business at the Faculty Research Forum, January 28, 2005 sponsored by Pace Center for Teaching, Learning, & Technology.

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Alliance longevity is an important concept because of its relevance to alliance performance. However, besides its treatment as a proxy measure of performance, longevity of alliances has not been studied as a meaningful concept by itself. In this study, I develop a model that delineates the various relationships of alliance longevity with a set of antecedent factors. A review of the pertinent literatures of transaction cost and dynamic capabilities yield five antecedent factors: alliance type, hierarchy of alliance structure, alliance experience with partner, general alliance experience, and number of partners with alliance unit. The direct and moderating relationships of alliance longevity with these five factors produce eight hypotheses. Cox regression results using data from 546 alliances support some of the hypotheses and offer counter-intuitive insights for others.

NOTE: Only the abstract of this paper is being made available by the author at this time.

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