Competitive Behaviour of Young Firms under Industry Deregulation: The Role of Boards in Adoption of Nonconformist Strategies

Abstract

Based on institutional and resource dependence theories, this paper investigates how board structures and board share ownership affect young firms’ competitive nonconformity behaviours. By using the 7,391 competitive actions of fifteen commercial banks, we establish that larger board size leads young firms to adopt competitive nonconformity strategies while more foreign board directors and higher share ownership of board directors discourage young firms to employ competitive nonconformity strategies. The proposed study provides a better understanding of young firms` competitive behaviours under industrial deregulation where the pressure for institutional conformity is normally largely reduced.