Abstract:
In democratic settings, organizations often encounter the enactment of detrimental public policies that are later reversed due to rather predictable political cycles. Standard organizational responses to detrimental public policies examined in the literature, such as exiting the market altogether, attempting to change the public policy through various political strategies, or passively adhering to the policy, might not be suitable when a detrimental public policy is likely to be reversed. In this paper, I consider organizational dormancy, a temporary reduction in the level of activity, as a viable alternative solution. In particular, I propose that in response to the onset of a detrimental public policy some organizations might be able to undergo a period of strategic inactivity until a favorable public policy returns. I also propose that such dormancy is rewarded when a favorable public policy returns. A preliminary investigation in a panel of private commercial banks in the Indian banking industry from 1981-2004 lends support to these arguments.

Professor Rajiv Krishnan Kozhikode is an assistant professor at the Beedie School of Business and a fellow for the Jack Austin Centre. He received his Ph.D. in management from the Hong Kong University of Science and Technology in 2010. He was an assistant professor at the University of Groningen from September 2010 to August 2012.His primary research interested is in business-government relations and corporate political activity. In his doctoral dissertation he examined how spatial and temporal inconsistencies in public policy prescriptions influence firm strategy.These issues were examined in three rich archival datasets spanning over 50 years on the evolution of the Banking and News Paper industries in India.

Apart from this, he is also interested in the sociological foundations of organizational misconduct and organizational innovation in emerging economies in the Asia Pacific region. His research has appeared twice in the Academy of Management Journal, the flagship journal of the Academy of Management. His research has also been published in Asia Pacific Journal of Management, Journal of International Management, Organizational Dynamics and Academy of Management Best Paper Proceedings.