The Influence of Country and Firm Networks on International Alliance Formation

We examine how a firm’s position in the network of industry ties and the position of its home country in the network of intergovernmental ties influence its make- or-ally decisions. We argue that firm centrality provides opportunities for collaboration while home country centrality reduces the value of collaboration. We also argue that the influence of firm and country centrality on a firm’s decision to collaborate varies with the magnitude of the resources required to undertake new product development. We find support for our predictions in the aircraft industry during the 1944-2000 period. We contribute to the network and international alliances literatures.