The dynamics of multimarket competition in exploration and exploitation activities

Jaideep Anand, Luiz Mesquita, Roberto Vassolo

Research output: Contribution to journalArticle

56 Citations (Scopus)

Abstract

Prior studies of multimarket contact have investigated " exploitation" rather than "exploration" activities. We contrast effects of multimarket contact on entry and exit dynamics in these two settings and propose that, although in exploitation, firms seek to optimize multimarket contact based on mutual forbearance benefits, in exploration, firms instead seek to reduce uncertainties through mimetic entry and exit. Analyses of biopharmaceutical firms' competitive dynamics from 1989 to 1999 support our model. We also find that multimarket contact in exploration leads to competitive entry and exit in exploitation, but not vice versa. We discuss implications for theory and practice.

Original languageEnglish (US)
Pages (from-to)802-821
Number of pages20
JournalAcademy of Management Journal
Volume52
Issue number4
StatePublished - Aug 1 2009

Fingerprint

Multimarket contact
Multimarket competition
Exploration and exploitation
Exploitation
Entry and exit
Uncertainty
Competitive dynamics
Biopharmaceuticals
Mutual forbearance

ASJC Scopus subject areas

  • Business and International Management
  • Management of Technology and Innovation
  • Strategy and Management
  • Business, Management and Accounting(all)

Cite this

The dynamics of multimarket competition in exploration and exploitation activities. / Anand, Jaideep; Mesquita, Luiz; Vassolo, Roberto.

In: Academy of Management Journal, Vol. 52, No. 4, 01.08.2009, p. 802-821.

Research output: Contribution to journalArticle

@article{4f8a72442c0e4612984915ba186cac55,
title = "The dynamics of multimarket competition in exploration and exploitation activities",
abstract = "Prior studies of multimarket contact have investigated {"} exploitation{"} rather than {"}exploration{"} activities. We contrast effects of multimarket contact on entry and exit dynamics in these two settings and propose that, although in exploitation, firms seek to optimize multimarket contact based on mutual forbearance benefits, in exploration, firms instead seek to reduce uncertainties through mimetic entry and exit. Analyses of biopharmaceutical firms' competitive dynamics from 1989 to 1999 support our model. We also find that multimarket contact in exploration leads to competitive entry and exit in exploitation, but not vice versa. We discuss implications for theory and practice.",
author = "Jaideep Anand and Luiz Mesquita and Roberto Vassolo",
year = "2009",
month = "8",
day = "1",
language = "English (US)",
volume = "52",
pages = "802--821",
journal = "Academy of Management Journal",
issn = "0001-4273",
publisher = "Academy of Management",
number = "4",

}

TY - JOUR

T1 - The dynamics of multimarket competition in exploration and exploitation activities

AU - Anand, Jaideep

AU - Mesquita, Luiz

AU - Vassolo, Roberto

PY - 2009/8/1

Y1 - 2009/8/1

N2 - Prior studies of multimarket contact have investigated " exploitation" rather than "exploration" activities. We contrast effects of multimarket contact on entry and exit dynamics in these two settings and propose that, although in exploitation, firms seek to optimize multimarket contact based on mutual forbearance benefits, in exploration, firms instead seek to reduce uncertainties through mimetic entry and exit. Analyses of biopharmaceutical firms' competitive dynamics from 1989 to 1999 support our model. We also find that multimarket contact in exploration leads to competitive entry and exit in exploitation, but not vice versa. We discuss implications for theory and practice.

AB - Prior studies of multimarket contact have investigated " exploitation" rather than "exploration" activities. We contrast effects of multimarket contact on entry and exit dynamics in these two settings and propose that, although in exploitation, firms seek to optimize multimarket contact based on mutual forbearance benefits, in exploration, firms instead seek to reduce uncertainties through mimetic entry and exit. Analyses of biopharmaceutical firms' competitive dynamics from 1989 to 1999 support our model. We also find that multimarket contact in exploration leads to competitive entry and exit in exploitation, but not vice versa. We discuss implications for theory and practice.

UR - http://www.scopus.com/inward/record.url?scp=70350304882&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=70350304882&partnerID=8YFLogxK

M3 - Article

AN - SCOPUS:70350304882

VL - 52

SP - 802

EP - 821

JO - Academy of Management Journal

JF - Academy of Management Journal

SN - 0001-4273

IS - 4

ER -