The strength of ties on legitimacy in the different development stages

Abstract

In this paper we try to find out the importance of legitimacy across different stages of corporate life cycles. We introduce the concept of ties intensity and develop a conceptual framework showing that at the enterprise's different development stages, how the two different kinds of ties intensity will affect the legitimacy types. Our research is devoted to find out what kind of effect will different development stages have on legitimacy. We find that in enterprise creation period, the strength of market ties has positive effect on the legitimacy, but the strength of government ties has no significant effect on it; In the early growth period of enterprises, the strength of market ties has no significant effect on the legitimacy, but the strength of government ties has positive effect it; In the mature period of the enterprise, the strength of market ties has positive effect on the legitimacy, the strength of government ties has no significant effect on it.