Frenemies: The Influence of Competitors’ Cooperation on Technological Adoption

Paul Décaire, W. P. Carey School of Business at Arizona State University

Abstract: The development and adoption of new innovative technologies confront firms into making decisions in highly uncertain environment. Past experience and the available public information are seldom sufficient to support firms in their decision process; firms ability to experiment and produce new information is then paramount. In this sense, firms’ organizational structure influences their ability to efficiently allocate resources, such as processing and producing new information; a central feature when it comes to new technology adoption. However, multiple empirical challenges have long constrained economists to properly investigate such phenomenon. Using a natural experiment in the American oil and gas industry, this study will provide the first set of causal evidence of the role organizational structure (i.e. Joint-venture) on the development and adoption of new technology.