Researchers in corporate strategy have long argued that resource "relatedness" contributes to a firm’s competitive advantage. One implication is that entries made by a firm into businesses that are closely related to the firm’s existing businesses should have higher survival rates than...

Researchers in corporate strategy have long argued that resource “relatedness” contributes to a firm's competitive advantage. One implication is that entries made by a firm into businesses that are closely related to the firm's existing businesses should have higher survival rates than...

In this article, we examine whether the option value of keeping an operation alive will deter firms from exiting an industry. We find that uncertainty dissuades firms from exiting an industry, but only when the sunk costs of entering and exiting that industry are sizeable. Moreover, we argue and...