Abstract
Interfirm networks are one of the core modes of corporate governance. However, its formation mechanism is not clearly and adequately delineated. This article highlights the significance of property rights to the formation mechanism of interfirm networks. Using interlocking directorate data from Chinese listed companies during the years 2000–2010, we investigate the association between ownership and network formation, at both the individual attribute level and dyadic level. Results show that companies owned or controlled by the state are more likely to form interlocking networks, and these relations tend to emerge among companies that have identical ownership. The higher the administrative level to which state-controlled companies are affiliated, the more likely they are to form interlocking networks. Theories of economic efficiency also have some explanatory power regarding network formation.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.