“Network Position and Performance: Merit or Privilege?“
Abstract: We theorize the relationship between an organization’s performance and its position within an inter-organizational network (i.e., the position-performance relationship) and propose an analytical framework for adjudicating accounts of positional advantage that emphasize superior capabilities (i.e., merit) versus superior opportunities (i.e., privilege). We demonstrate the framework’s utility by analyzing data on new firms entering the U.S. venture capital industry’s co-investment network between 2000 and 2021. Analyses of investment observables and performance residuals implies that the position-performance relationship is largely attributable to superior access to investment opportunities. Specifically, we find that firms whose members possess privileged characteristics, both ascribed (i.e., race, ethnicity, gender) and achieved (i.e., prior education and employment), tend to invest in high potential deals but do not typically produce performance in excess of that predicted by deal observables. We conclude with a discussion of the assumptions justifying merit versus privilege interpretations of network advantage.
Professor Rider’s research examines the reciprocal relationship between entrepreneurship and societal inequality. He also studies racial disparity in various empirical contexts, with a focus on sports settings.
His research is published in Administrative Science Quarterly, American Journal of Sociology, Organization Science, Strategic Management Journal, Research in Organizational Behavior, Research Policy, ILR Review, Industrial & Corporate Change, Sociological Science, the American Economic Review Papers & Proceedings, and California Management Review. Many media outlets — including ESPN, the New York Times, the Wall Street Journal, Fast Company, the Washington Post, Al Jazeera America, and the Boston Globe — featured his research. He is a former Associate Editor for Administrative Science Quarterly and Management Science and a former Senior Editor for Organization Science.
Prior to joining the Ross faculty, he was on the faculties of Georgetown University’s McDonough School of Business, Emory University’s Goizueta Business School, and the University of Chicago’s Booth School of Business. He also held strategic management positions at Cars.com, Intel Corporation, and Verizon Communications. Learn more at ChrisRider.info.
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