The Role of Attribution in Learning from Performance Feedback: Behavioral Perspective on the Choice between Alliances and Acquisitions

Abstract

The causal attribution of performance has not been explicitly considered in the performance feedback literature, despite its potential value in learning from prior performance. In this study, we develop a theory concerning the attribution in learning from performance feedback and explore how the attribution of past alliance performance can influence a firm’s choice between future acquisitions and alliances. We also examine the mechanisms by which attribution manifests by exploring how three theoretical factors, known to influence attribution, can moderate the relationship - the diffusion of responsibility, the perceived capability of partners, and the ambiguity of performance information. We find strong evidence supporting our predictions. This study contributes to the performance feedback literature by integrating attribution with performance feedback theory. It also extends research on corporate strategy by providing a behavioral account of the choice between acquisitions and alliances.