EAM International 2017 Proceedings »
Environmental Jolts and Strategic Alliances in the Aftermath of the 9/11 Terrorist Attacks
Track: Policy and Strategy
Keywords: Environmental Jolts, Strategic Alliances, Slack, Terrorism
This study extends the research on jolts by adding the impact of geographical proximity and its impact on the use of alliances. We predict firms closer to a jolt based on their perception of risk exhibit a stronger response than firms farther away. Using data on alliances prior and after the 9/11 attacks, we found that there was a decrease in alliance activity in aftermath of attacks and this decrease was significantly smaller for US based firms relative to non US firms. Our study contributes by illustrating that a heightened perception of risk increases the organizational capacity to withstand threats.