Why Do Small Firms Benefit Less From Alliances Than Large Firms?

Recent academic and practitioner research suggests that small firms are disadvantaged in strategic alliances. However, relatively little work explores the potential sources of these disadvantages. Using the comparative approach of transaction cost economics and the capability emphasis of the resource-based view, this chapter develops a framework that explores the extent to which differences in the partners available to small firms, the forms of governance chosen by small firms, the types of problems examined by small firms, and other firm attributes affect alliance organization decisions and subsequent performance across small and large firms.