The Liability Of Strangers: Performance Consequences Of Non-Local Partnering

This paper examines the performance consequences of non-local partnering formation of new ties between organizations that have neither direct nor indirect connections. Although non-local ties provide organization with potential benefits including enhanced opportunities to broker resource and information flows across unconnected partners, they also entail risks associates with the absence of collaborative routines and limited information regarding non-local partners' capabilities and cooperativeness. the analysis of Canadian investment banks' underwriting syndicate ties confirms that while, initially, non-local partnering is detrimental to performance, with repetition these ties begin to enhance performance.