Building on social embeddedness theory, we examine how the competencies and resources of one corporate actor in a network are transferred to another actor that uses them to enhance transactions with a third actor-a strategic process we dub 'network transitivity.' Focusing on the properties of network transitivity in the context of small-firm corporate finance, we consider how embedded relations between a firm and its banks facilitate the firm's access to distinctive capabilities that enable it to strategically manage its trade-credit financing relationships. We apply theory and original case-study fieldwork to explore the types of resources and competencies available through bank-firm relationships and to derive hypotheses about how embedded bank-firm relationships affect the strategy of small-to medium-sized firms. Using a separate large-scale data set, we then test the generalizability of our hypotheses. Our qualitative analyses show that embedded bank-firm ties provide special governance arrangements that facilitate the firm's access to bank-centered informational and capital resources, which uniquely enhance the firm's ability to manage trade credit. Consistent with our arguments, our statistical analyses show that small-to medium-sized firms with embedded ties to their bankers were more likely to take lucrative early-payment trade discounts and avoid costly late-payment penalties than were similar firms that lacked embedded ties-suggesting that social embeddedness beneficially affects the financial performance of the firm.

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While traditional behavioral decision theory as applied to negotiation sheds light on some of the barriers encountered in negotiations, it does not fully account for many of the difficulties and failures to reach settlement in ideologically-based disputes. In this paper, we identify a number of factors that differentiate ideologically-based negotiations from other types of negotiation, and advance a perspective that takes into account the value-laden and institutional contexts in which they occur. We illustrate our ideas by applying them to the organizationally relevant example of environmental disputes.

Human ingenuity offers the best hope for tackling a whole range of environmental problems currently threatening global welfare, yet the human mind also creates cognitive barriers to wise environmental agreements. In this article, the authors focus on a set of six systematic cognitive barriers that are particularly endemic to environmental disputes. The fixed-pie bias grows from the assumption that disputants' interests are perfectly opposed. This mythical fixed pie inhibits the discovery of beneficial trade-offs that integrate parties' interests. The authors also discuss five other cognitive biases that combine with the fixed-pie assumption to influence the resolution of disputes in the environmental domain: pseudosacredness, egocentrism, overconfidence, unrealistic optimism, and endowment effects. They discuss the potential role of learning and experience in improving negotiator performance and conclude with prescriptive advice for overcoming these cognitive barriers.