Competing and cooperating globally: how firms’ multimarket contact relates to joint price elevation in coopetition networks

Abstract

Purpose This study aims to draw attention to the familiarity effect among international multimarket contact (MMC) firms on coopetition in the global container shipping industry and to better understand the contingency model of structural holes and in-degree centrality on joint price elevation actions and subsequent performance. Design/methodology/approach Drawing on competitive dynamics and the literature on networks, a panel data model is developed from 6,489 competitive and 7,146 cooperative actions of the top 21 shipping firms in 18 global arenas with a structured content analysis method being applied. Findings Stronger MMC by firms requires increased levels of cooperative actions to elevate prices. This coopetition relationship is enhanced or weakened when the focal firm occupies a higher level of structural hole or position of competitive in-degree centrality. Practical implications Shipping liners seeking to cooperate with joint action in oligopolistic markets are offered guidelines and strategies to increase their performance through their actions. Originality/value This study contributes to the literature on coopetition networks by further analyzing interfirm relationships and interactions that enhance performance, while exploring network positioning strategies to mitigate risks.