The Impact of Network Resources on Competitive Behavior of Firms

Firms extend access to resources and information by collaborating with other firms. This paper explores how resource endowments accessible to a firm through its social network affect a firm’s competitive behavior. We suggest that a firm’s partners’ knowledge portfolio - stock and diversity- has a positive impact on a firm’s competitive actions repertoire in terms of volume, complexity, and heterogeneity. Further, we argue that firms have different access knowledge depending on the network position, mainly its centrality and access to structural holes, that allow them to initiate actions. We find that partners’ knowledge stock has a positive effect on action volume and heterogeneity, while partners’ knowledge diversity has a positive effect on action complexity. Further, we found that centrality will enable firms to leverage partners’ diversified knowledge to initiate more actions as well as heterogeneous actions. However, centrality has a substitutive effect where higher knowledge stock of partners dampens the volume and heterogeneity of actions taken by a firm. We interpret and discuss the implications of the findings for research and practice."