Introduction to Part I—Viewing Networks as Social Systems

Abstract

In industry settings that are defined by stagnation or diminishing markets, firms often face pressure to rationalize and seek sustainable margins. Three responses are typical. Firms may (a) seek new economies of scale and attempt to increase their overall market size or decrease costs; (b) develop economies of scope and seek new synergies between the different activities the firm is performing so as to distribute overhead and fixed costs across a wider range of products and services, often achieved by measures such as cross-selling; or (c) differentiate through innovation and forge new markets or expand existing ones.