|Dr. Tatevik Poghosyan
How Board Networks Affect Firm Performance and Innovation Incentives in Transition Economies: The Case of Armenia
Robin Cowan and David O’Brien
This thesis explores board member networks and their influence on firm performance and innovation and presents a conceptual framework for understanding and ultimately predicting the impact of board network features on firms in both established and transitional economies. Board member networks refer to the connectedness between firms in an economy resulting from individual board members who have the membership of more than one firm boards. The study considers these networks as having an intrinsic business value for firms, known in the literature as “social capital”. The thesis proposes that “structural” and “content” attributes of board member networks are the key levers underlying the social capital of these networks and their value for firms. Applying insights from social capital theory, the structural aspect of the social capital emphasizes the role of the firm’s position in the board network, while network content suggests that attributes of partner firms are also significant factors toward firm performance and innovation. The study's intention was to depict features of the Armenian National Innovation both from looking at the macro-level changes and reforms and utilizing micro-level data to understand firm’s innovative mode. The study reveals specificities of the Armenian transition context and what type of knowledge production mode was persistent while transitioning from the Soviet system to a new system. The empirical evidence is based on the unique database, which reflects the historical change of large post-soviet firms into private firms. In addition, the first country-wide firm-level innovation survey was conducted in Armenia to obtain information on the firm's innovation.