Research Summary

Organizational Structure and Firm Financial Performance

by John Beshears

Description

Turning his attention to firm-level outcomes, Professor Beshears has used data from oil and gas drilling in the Gulf of Mexico to measure how a corporate alliance—a group of firms that jointly develops an offshore tract—performs compared with a solo firm, while controlling for the type of project under development. As a form of institutional design, the alliances were more profitable than the solo firms because they benefitted from combining their knowledge and expertise.