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Managing Ongoing Interorganizational Relationships: Power Asymmetry, Shared Third Party, and Reciprocity Between Loan Guarantee Partners

Office of Alumni and External Relations    2020-09-15


Managing Ongoing Interorganizational Relationships: Power Asymmetry, Shared Third Party, and Reciprocity Between Loan Guarantee Partners


Guest:Lisha Liu, Ph.D. Candidate in the Department of Sociology at Cornell University

Host:Li Xinxin, Assistant Professor

Time:Wednesday, Sep 16th, 2020, 10:30-12:00

Venue:ZOOM

 

Abstract:

Organizational theorists have extensively documented the role of shared third party in strengthening the ongoing relationship between a pair of organizations, but paid little attention to the relative power between the organizations. This paper examines how dyadic power asymmetry impacts the role of shared third party in the unfolding of interorganizational relationships. I theorize that having a shared third party buffers high-power actor from its partner but bonds low-power actor to its partner. Using a longitudinal dataset of inter-firm loan guarantees between Chinese publicly listed firms in the period 2008-2016, I find that a high-power firm is less likely to directly reciprocate its partner when they have a shared third party. Rather, the high-power firm uses the shared third party as a bridge and is more likely to indirectly reciprocate its partner. By contrast, a low-power firm is more likely to stick to direct reciprocity with its partner and to a less extent uses indirect reciprocity when they have a shared third party. My findings highlight power as a crucial contingency on how organizations can leverage shared third party in managing ongoing relationships with their partners.

Bio

Lisha Liu is a Ph.D. candidate in the Department of Sociology at Cornell University. She studies how organizations are shaped by opportunities and constraints in their environment, including interorganizational networks and the broader institutional environment. Her research has been published in Socio-Economic Review and Sociological Science. She has a paper receiving “revise and resubmit” at the Academy of Management Journal, and two papers under review at Administrative Science Quarterly and Organization Science. Her research has won a number of awards, including the Best Paper Award for the Social Responsibility Division from the 2019 Administrative Sciences Association of Canada, an Early Career Workshop Award from Society for the Advancement of Socio-Economics, and Robert B. McGinnis Paper Award from Cornell University. She also received the Jeffrey S. Lehman Fund for Scholarly Exchange with China along with the East Asia Program Fellowship from Cornell University, and the ICPSR Clifford C. Clogg Scholarship from the University of Michigan.  


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