Honeymoons and the liability of adolescence: a new perspective on duration dependence in social and organizational relationships

Article Abstract:

Many social relationships face a liability of adolescence; the hazard rate of the relationship ending increases for an initial period and then declines. The pervasiveness of this phenomenon suggests that there may be a common set of underlying factors. We believe that many relationships start with an initial stock of assets, which can take a variety of forms (depending on the context), including favorable prior beliefs, trust, goodwill, financial resources, or psychological commitment. We hypothesize that these assets reduce the risk of the relationship dissolving when the initial outcomes of the relationship are unfavorable, resulting in a honeymoon period. The duration of this honeymoon period is a function of the magnitude of these assets. We survey earlier results and report new analyses. For organizational theory, this model of duration dependence raises problems for Stinchcombe's (1965) liability of newness hypothesis, which is central to much theorizing on the population ecology of organizations. We believe researchers have overlooked such a pattern because of their overreliance on parametric representations, which assume monotonic changes in the hazard rate with respect to time. (Reprinted by permission of the publisher.)

Psychological aspects, Interpersonal relations, Social psychology

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Role of individual attachments in the dissolution of interorganizational relationships

Article Abstract:

In this study, we propose that changes affecting the resource fit between organizations exchanging resources provide an impetus for the dissolution of their relationships, whereas the individual and structural attachments that develop between exchange partners over time counter those pressures for change. The empirical analysis examined the severance of auditor-client relationships using a case-control design. Change in clients' resource needs increased the likelihood of their switching auditors, but attachment of individuals primarily responsible for the exchange relationship decreased the likelihood of switching. Moreover, those attachments attenuated the effect of changes in clients' resource needs on the likelihood of switching auditors. The study suggests that ties between boundary spanners play a major role in the maintenance of interorganizational relationships. (Reprinted by permission of the publisher.)

Social aspects, Research, Corporate culture, Attachment behavior, Attachment (Psychology)

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What is 'not' a real option: Considering boundaries for the application of real options to business strategy

Article Abstract:

An argument is made that the greater the extent to which choice sets evolve as a consequence of firms exploration activities, the less structured the firmsE abandonment decisions become and in turn the less distinguishable a real option is from more generic notions of path dependence. Organizational adaptations can extend the applicability of real options and they impose tradeoffs that may lead to the underutilization of discoveries.

United States, Decision-making, Models, Decision making, Strategic planning (Business)

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