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Abstract
Research indicates that power of a controlling organization is inversely proportional to the controlling organization's dependence on the resource. This conceptual study argues that the relationship is more complex and must take into account the situation where both power and dependence are high for the controlling organization. Using the viewpoint of the United States (US) government and the military-industrial complex, two possible explanations are proposed. First, separate from dependence, structural power associated with the industry hierarchy plays a key role in determining overall organizational power. Second, the monopolist structure of the industry positively modifies the relationship between power and dependence thereby reducing the negative impacts of dependence on power. Following proposition arguments, organization power and control of industry competition are examined, along with future research directions.
Keywords: United States government; Military; Organizational power; Resource dependence; Industry competition
Introduction
Considered a classic in organizational theory, resource dependence theory is currently attracting new attention for applications in today's environment, opening doors for new perspectives by today's scholars. Recent work by Casciaro & Piskorski (2005) cites discrepancies between the theory's basic tenets and past empirical results. They ultimately propose and provide empirical support to a reformulation of the theory while maintaining it remains a powerful tool to explain organizational decision-making and actions.
Many studies in resource dependence theory are taken from the perspective of the organization being controlled, instead of from that of the controlling organization. Scholars in power and dependence have suggested that shifting the perspective from the controlled organization to the controlling organization may yield interesting research results (Aldrich, 1999). This change in perspective, combined with the chosen context of the US military-industrial complex, provides a fresh look into the fundamental principle of the theory with respect to power and dependence. More specifically, this research re-examines the proposition that power of the focal organization is inversely proportional to its dependence on its resources (Pfeffer and Salancik, 1978). This formulation does not take into account the organization that is both powerful and highlydependent on its resources, as is evident with the US government. As the sole purchaser and end-user of many critical high technology military products, the US government is highly dependent on a few large US defense firms, yet also yields tremendous power...