Managers' Mobility and Market Interface: The Effect of Managers' Career Mobility on the Dissolution of Market Ties

Abstract

Using social embeddedness arguments, this study examines how the mobility of managers in professional service and client firms affects dissolution among their firms' market ties for that service. My analyses from a sample of agencies and clients in the advertising industry from 1986 to 1998 show that the exit of managers from client firms increases the likelihood that market ties dissolve and that the results are contingent on the size of the firm. In professional service firms, both the exit and promotion of managers affect the number of market tie dissolutions, but these results are contingent on managers' functional roles and the number of market ties maintained by professional service firms. Taken together these findings illustrate how dynamics in managerial labor markets affect market ties for services and how firms' characteristics moderate these effects. The results suggest several refinements to the social embeddedness perspective. *