Stability and change in embedded relationships: Broken ties in Japanese automotive keiretsu

Ahmadjian, Christina L.; Robbins, Gregory E.

This study examines how destabilizing pressures interact with embedded exchange relationships in an analysis of broken ties between Japanese auto manufacturers and their suppliers. While functional, political and social pressures all led to broken ties, their effect differed depending on the nature of the tie. We define two types of embeddedness, relational and normative, and argue that while political and social pressures lead to breakage of normatively embedded ties, relationally embedded ties are robust to these pressures. In contrast, functional pressures, specifically, performance, lead to breakage of relationally embedded ties. Our theory and empirical findings have implications for the study of networks and embeddedness and for research on institutional change in business systems.

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Academic Units
Center on Japanese Economy and Business
Center on Japanese Economy and Business, Graduate School of Business, Columbia University
Center on Japanese Economy and Business Working Papers, 239
Published Here
February 14, 2011