Extra-Network Linkages, Dependence, and Power

Abstract

Several researchers have investigated the direct impact of a firm's environmental linkages on power in an interorganizational netwvork. These studies have generally investigated powerldependence relations among members of human service agency networks. This study examines the relationship among power, resource dependence, and extra-network linkages in a manufacturer-dealer netwvork, utilizing a methodology that analyzes both direct and indirect effects. Results of the study . suggest that dependence has a direct effect on power. Linkages to the task environment have an indirect effect on pozver through their relationship with dependence. The major purpose of this study is to explore the structural relationships among power, dependence, and extra-network linkages in an interorganizational marketing network. The linkages examined here include joint programs, relationships with supplemental suppliers, and contacts with industry elites. Of particular interest is the impact of extra-network linkages on dependence and power. The exchange theoretic approach has emerged as the dominant perspective in the study of interorganizational relations (Cook). Theorists who advocate this approach (e.g., Aiken and Hage; Aldrich; Benson; Cook; Jacobs; Levine and White; Pfeffer and Salancik; Thompson; Van de Ven; Warren; Whetten and Leung; Zald) argue that scarcity of resources fosters specialization and creates organizational interdependence-or resource dependence. Through exchange relations, organizations which perform specialized functions can obtain resources critical to their operations. When exchange relations entail ties of mutual dependence between organizations, it is imperative to each organization to have the ability to *We acknowledge the helpful suggestions of the anonymous referees on an earlier version of this paper. Address correspondence to either author, Department of Marketing, University of Kentucky, Lexington, KY 40506. ? 1986 The University of North Carolina Press