Alliance or acquisition: A dyadic perspective on interfirm resource combinations

This dissertation adopts a resource-based perspective at a dyadic level to study when and how two firms may combine their resources. Alliances and acquisitions are two alternative governance forms for two firms to combine their resources to achieve many similar strategic goals. Firms, therefore, constantly face the situation of choosing between the two. I argue that alliances and acquisitions are two distinctive organizing forms that involve different strategic concerns and organizational concerns. The configurations of two firms' resources and capabilities are closely related to these concerns and thus have significant effects on when and how two firms may combine their resources.;In this dissertation, I examined how three aspects of configurations of resources and capabilities held by two firms---business similarity and complementarity of two firms, relational capabilities of two firms and partner-specific knowledge of two firms---might affect when and how two firms may combine their resources. I also examined whether the resource combination efforts were rewarded by the stock market.;The findings from a sample of the largest firms in the United States for the period of 1991--2000 indicate that all these factors play important roles in interfirm resource combinations. Specifically, two firms with highly similar products or technologies, highly complementary technologies, greater combined relational capabilities, and more partner-specific knowledge are more likely to combine their resources, either through alliances or acquisitions. By contrast, asymmetry of relational capabilities, in general, discourages firms to combine their resources.;In addition, firms choose the governance form for resource combinations based on the configuration of their resources and capabilities. Firms with highly similar or complementary technologies, with greater combined alliance capabilities and greater partner-specific knowledge in alliances prefer alliances to acquisitions. Firms with highly similar products, with greater combined acquisition capabilities and greater partner-specific knowledge in acquisitions prefer acquisitions to alliances.;The findings from the stock market's reaction to the resource combination announcements of two firms indicate that the managerial efforts of resource combinations are not, in general, rewarded by the stock market.