VASSOLO Roberto Santiago
The Dynamics of Multimarket Competition in Exploration and Exploitation Activities
ANAND, J.; MESQUITA, L.; VASSOLO, R. S.
ACADEMY OF MANAGEMENT JOURNAL
Academy of Management
Año: 2009 vol. 52 p. 802 - 821
Prior studies of multimarket contact have investigated ´exploitation´ rather than ´exploration´ activities. We contrast effects of multimarket contact on entry and exit dynamics across these two settings. Based on analyses of biopharmaceutical firms competitive dynamics from 1989 to 1999, we find support for our model that, while in exploitation, firms seek to optimize multimarket contact based on mutual forbearance benefits, in exploration, firms seek to reduce uncertainties through mimetic entry and exit. 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.