Resistance to Change
16 Pages Posted: 21 Nov 2013
Date Written: November 19, 2013
Established firms often fail to maintain leadership following disrup tive market shifts. We argue that such firms are more prone to internal resistance. A radical adjustment of assets affects the distribution of employee rents, creating winners and losers. Losers resist large changes when strong customer goodwill cushions the consequences. Partial adaptation may lead winners to depart to form new firms with no goodwill, but no internal resistance.
JEL Classification: D02, D23, L25
Suggested Citation: Suggested Citation