This article develops a theoretical model to explain the variation of network structures and network dynamics according to industry and firm resource characteristics and the extent of resource dependency. It incorporates an accountability and corporate governance dimension and thereby seeks to explain the long-run processes of industrial and corporate change. To verify the theoretical framework, the article examines the long-run evolution of network structures in the British cotton industry. It shows how this industry developed network structures as part of the process of industrialization and then goes on to explain how these structures prevented flexible and timely responses to the later challenges of restructuring and re-equipping. The article also shows that the application of the theoretical model offers an opportunity to reinterpret the history of this archetypal industry.
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