ASQ Research Discussion - Volume 1, Number 1
ASQ Research Discussion Listserver
Volume 1, Number 1, August 21, 1995
Postings and subscription requests: ASQ@UMICH.EDU.
Contents
- Editor's welcome from Steve Barley
- Moderators' welcome from Will Mitchell and Brad Killaly
- Question from Will Mitchell: What determines whether the likelihood that businesses will fail decreases or increases with age when size is controlled?
1. Editor's welcome from Steve Barley
I want to welcome you to the ASQ listserver. Our hope is that this server will stimulate important scholarly discussions and useful interactions among those in the field of organization studies and related disciplines. We live in a period when the world of work and organizations are rapidly changing, where old institutions are being reshaped and new ones formed. I can imagine no more exciting times for the organization studies community. And, I can imagine no period of history in which students of work and organizations could have more to contribute not only to the scholarly community and its various constituencies but to society at large. People in all walks of life are looking for ideas to help them understand the upheavals, big and small, that are restructuring their lives and the world in which they live. Many of these upheavals are rooted in the world of work and originate with the organizations that are now the primary institutions in most of our lives. It seems to me that a listserver might be a place where we can work to develop those ideas.
Anthropologists and sociologists of science tell us that knowledge is always developed within a community. The potential of a listserver is to create a knowledge seeking community unhindered by the walls of space and time. We would like this listserver to become a place where thinkers meet to share ideas, observations and analyses, a place where researchers can interact with and perhaps even recruit others interested in similar topics. Perhaps the listserver might even lead to new research collaborations, new lines of inquiry, or the development of new perspectives.
Unlike other listservers, ASQ's will not distribute announcements of meetings, job postings and other bits of professional news relevant to members of the field (although we may from time to time use the listserver to distribution information about developments at the journal itself). There are other listservers that already serve these professional functions admirably well. We are also not interested in becoming a forum for the various forms of vitriol that sometimes capture other listservers. This is why Will Mitchell and Brad Killaly will serve as the listserver's moderators. We want subscribers to know that when they receive a digest from ASQ's listserver the odds are that it will contain serious and perhaps even provocative intellectual content.
What sort of use do we imagine subscribers making of the ASQ listserver? The possibilities are wide, and I will simply list a few with the understanding that I offer them in the spirit of providing illustrations rather than boundaries. The ASQ listserver should be a place where readers post ideas stimulated by articles published in ASQ -- electronic letters to the editor. It should be a place were ASQ's readers and authors engage in scholarly exchanges on the ideas that authors have published. But the content need not be tied to papers published in ASQ. Communications might as easily be stimulated by books, articles published elsewhere or even developments in the real world. Subscribers might use this listserver to pose conceptual or methodological puzzles for the larger community to consider. It could be used as a forum for seeking help and information pertinent to research. It might be a place for the collaborative refining of ideas. The listserver might serve as a nexus for organizing new invisible colleges or proposing research agendas for the field. It might become the locus of a number of ongoing symposia involving scholars who would not ordinarily have an opportunity to meet. And so on...
Ultimately, ASQ wants the listserver to be a force for vigor and vitality in the life of the field. We hope you will actively help us achieve this goal by not only reading but posting communications.
2. Moderators' welcome from Will Mitchell and Brad Killaly
We are delighted to be part of the initiation of the ASQ listserver. We hope that we can help spark raging debates concerning the research that is as the center of all our lives. We welcome your questions, comments, and ideas concerning papers that have been published in ASQ and other journals, as well as to research issues that fall within the domains of organizational theories. Please initiate discussions and take part actively in the ongoing debates.
3. Question from Will Mitchell: What determines whether the likelihood that businesses will fail decreases or increases with age when size is controlled?
I would be interested in your ideas concerning a theoretic basis for the difference in the argument and results of two papers that examine the relationship between business failure and business age while also controlling for business size.
David Barron, Elizabeth West, and Michael Hannan (BWH) recently published a paper in AJS (Age, size, and the growth and failure of organizations: Credit unions in New York. American Journal of Sociology, 100, 381-421, 1994), in which they argue that businesses and other organizations become more likely to shut down as they age when size is accounted for. The argument contrasts with the common finding that the risk of failure declines with age. BWH argue that small old organizations find it increasingly difficult to change as their environments change. Their empirical test is based on dissolution of credit unions.
By contrast, I recently published a paper (The dynamics of evolving markets: The effects of business sales and age on dissolutions and divestitures, ASQ, 39, 575-602, 1994) which finds that the likelihood that businesses will shut down declines significantly with age for startups and declines slightly with age for diversifying entrants, even when time-varying size is controlled. My empirical test is based on dissolution of medical device manufacturers.
My initial idea concerning the difference in the argument and results of the BWH and Mitchell papers is that at least part of the difference stems from differences in the likelihood that businesses will be divested rather than shut down. I agree with BWH that businesses often find it increasingly difficult to adapt to environmental change as they age. I suspect, though, that troubled older businesses will often be sold rather than shut down so long as two conditions apply: (1) the legal environment permits divestiture, (2) the troubled business has valuable organizational routines that it is cheaper for another business to purchase than to create from scratch. Thus, one would expect increasing likelihood of divestiture and decreasing likelihood of dissolution as a business ages when size is controlled, assuming that size is a measure of business success, so long as divestiture is an option. By contrast, one would expect increasing likelihood of dissolution if divestiture is not an option. I welcome your ideas about this issue.
