Status Signals: A Sociological Study of Market Competition
ISBN: , SKU: , AUTHOR: Podolny, Joel M., PUBLISHER: Princeton University Press, Why are elite jewelers reluctant to sell turquoise, despite strong demand? Why did leading investment bankers shun junk bonds for years, despite potential profits? "Status Signals" is <strong>thestrong> first major sociological examination of <strong>howstrong> concerns about status affect market competition. Starting from <strong>thestrong> basic premise that status pervades <strong>thestrong> ties producers form in <strong>thestrong> marketplace, Joel Podolny s<strong>howstrong>s <strong>howstrong> anxieties about status influence whom a producer does (or does not) accept as a partner, <strong>thestrong> price a producer can charge, <strong>thestrong> ease with which a producer enters a market, <strong>howstrong> <strong>thestrong> producer's inventions are received, and, ultimately, <strong>thestrong> market segments <strong>thestrong> producer can (and should) enter. To achieve desired status, firms must offer more than strong past performance and product quality--<strong>thestrong>y must also send out and manage social and cultural signals. Through detailed analyses of market competition across a broad array of industries--including investment banking, wine, semiconductors, shipping, and venture capital--Podolny demonstrates <strong>thestrong> pervasive impact of status. Along <strong>thestrong> way, he s<strong>howstrong>s <strong>howstrong> corporate strategists, tempted by <strong>thestrong> profits of a market that would negatively affect <strong>thestrong>ir status, consider not only whe<strong>thestrong>r to enter <strong>thestrong> market but also whe<strong>thestrong>r <strong>thestrong>y can alter <strong>thestrong> public's perception of <strong>thestrong> market. Podolny also examines <strong>thestrong> different ways in which a firm can have status. Wal-Mart, for example, has low status among <strong>thestrong> rich as a place to shop, but high status among <strong>thestrong> rich as a place to invest. "Status Signals" provides a systematic understanding of market dynamics that have--until now--not been fully appreciated.