'Coopetition': Market Commonality between Partners, Opportunism, and Value Creation in Strategic Alliances

Despite rapid evolution of coopetition research, concerns persist regarding competitors’ opportunistic tendencies when they cooperate. Our paper offers clarity in this area by illuminating the influence of market... [ view full abstract ]

Despite rapid evolution of coopetition research, concerns persist regarding competitors’ opportunistic tendencies when they cooperate. Our paper offers clarity in this area by illuminating the influence of market commonality on opportunism and implications for overall value creation. We build from three literature perspectives: Austrian economics, game theory, and industrial
organization, and argue that market commonality between alliance partners influences opportunism in a U-shaped manner. The relationship will be strongest where market commonality is balanced between partners, spheres of influence are present in overlapping markets, and intensity
of rivalry in shared markets is low. We anticipate that overall value creation will increase as
opportunism decreases. Our paper illustrates the role of market commonality as a self-enforcing
safeguard against opportunism, suggesting that coopetition may be a superior governance option
in certain contexts. The model will be tested with alliances in the semiconductor industry from
2000-2012. Data collection is in progress and results will be available before the IAM Doctoral
Colloquium.