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Competition and Social Influence: The Diffusion of the Sixth-Generation Processor in the Global Computer Industry

Posted by admin in 2003

Matthew S. Bothner

When is a social actor most strongly influenced by its peers? This article addresses this question by clarifying when computer firms were most strongly affected by the choices of their structurally equiv- alent rivals to adopt a well-known technology: Intel’s sixth-gener- ation processor. The core hypothesis is that the effect of adoptions by structurally equivalent firms increases with the competitive pres- sure that a focal firm faces in its market position. The results show that a chosen firm is most strongly influenced by comparable others when it faces scale-based competition and is diversified. The im- plications of this study are twofold: a social actor’s sensitivity to the conduct of others may depend not only on its place in a hierarchy but also on the nature of its ties to an external audience; and a contingent theory of social influence may be necessary to charac- terize diffusion processes correctly, particularly when external and time-varying nonnetwork factors have significant effects.

American Journal of Sociology, 108 (2003): 1175–1210


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