The Adoption of Corporate Governance Mechanisms: A Test of Competing Diffusion Models
N. Venkatraman, Lawrence Loh, Jeongsuk Koh
Management Science · 1994 · Volume 40 · Issue 4
Abstract
We develop alternative diffusion models of two corporate governance mechanisms— joint venture and M-form organizational structure —using relevant concepts from the resource-based theory. Using data on joint venture adoption from one homogeneous industry (information technology) sector and employing both linear and nonlinear estimations, we test the explanatory power of the internal-influence model in comparison with a competing model of external-influence. Our empirical results support the internal-influence model in this sector with additional evidence for generalizability provided through a multisector sample of joint venture formation. In contrast, empirical results on the diffusion of M-form structure are more consistent with the external-influence model.
Keywords
administrative innovations, diffusion models, joint ventures, M-form organizational structures, resource-based theory
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