| Little is known about how companies compete during market meltdowns---a period of significant decline in economic activity spread across companies competing in an identifiable market, lasting more than 11 months, normally visible in stock price indices, sales, employment, and asset disposal. The objective of this thesis is to develop and test a model that relates competitive aggressiveness and company performance during market meltdowns and explains how top management heterogeneity, liquidity, and past performance affect company aggressiveness. A set of seven hypotheses is tested using 71 action years drawn from 36 suppliers of telecommunications equipment during 2001--2003. Company performance is measured in three ways: sales per employee, change in sales, and return on assets. The results show that action diversity is the only dimension of competitive aggressiveness that affects all three measures of company performance. The greater action diversity, the lower company performance. This thesis also provides a method to examine the antecedents and consequences of competitive aggressiveness using structural equations models. |
