The Influence of Corporate Power, Social Status, and Market Position on Corporate Interlocks in a Regional Network

Abstract

The paper seeks to identify the criteria which companies use to select board members and which firms use to select the outside boards they sit on. Hypotheses were drawn from theories which view corporate interlocks as a strategy of market cooptation and from theories which argue that board interlocks are based on the prestige of CEOs or the prestige of companies. These hypotheses were tested on a population of 116 manufacturing corporations in a major metropolitan area. The statistical models used in the paper were developed by Fienberg and Wasserman. In sum, we found that interlocking on the metropolitan level was not influenced by the market position of firms. Neither dependencies across industrial sectors nor the locale of labor and consumer markets had any effects on the choice *Paper presented at the 1982 meetings of the American Sociological Assocation-Session on Elites. Support for this research has been provided by grants from the National Science Fottndation (SES 800-8570; SES 800-8573), and by the Center for Urban and Regional Affairs, University of Minnesota. We thank Andrew Van de Ven, Theodore Anderson, and Dawn Iacobucci for useful comments, and Jeanne-Marie Rohland, Joanne Losinski, and Lisa Thornquist for typing drafts of the manuscript. Address correspondence to either Stanley Wasserman, Departments of Psychology and Statistics, University of Illinois, Champaign, IL 61820 or Joseph Galaskiewicz, Department of Sociology, University of Minnesota, Minneapolis,