The advantages of being disadvantaged

Abstract

Although many contributions examine how individuals and various entities (e.g., organizations and countries) manage to obtain a (competitive) advantage, there is a knowledge gap on how to make the best of disadvantages. Using notably the theories of self‐enhancement and psychological reactance, the existing literature has explained the mechanisms that can motivate and support an entity to get out from a disadvantageous position. We go further by addressing the “how” issues. We conceptualize disadvantages and adopt a provocative stance by showing how they can be transformed into valuable opportunities. Specifically, we document how being disadvantaged may be a driver of compensatory behaviors, effectual thinking, and innovation and serves as an emotional bond and in‐group marker. We also draw managerial and policy implications that offer a refreshing view on how to take advantage of disadvantages, such as changing the non‐market context and promoting the disadvantage as a market differentiation factor. As a caveat, adopting this stance should not be interpreted as a catch‐all solution that exonerates stakeholders from doing their part in providing support to disadvantaged entities.