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Edith Penrose and the resource-based view of (international) business strategy

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  • Pitelis, Christos N.

Abstract

In recent years, there has been substantial interest in the work of Edith Penrose, particularly her contribution to the resource-based theory of (international) business strategy. The aim of this paper is to critically assess some recent literature, focusing, for illustrative purposes, on an article by Rugman and Verbeke (R-V). R-V's article claims that Penrose's focus was on value creation, not rents in equilibrium (the focus of the resource-based view). It also observes that the work by Penrose on the multinational enterprise did focus on value appropriation and rents, but this work was somewhat at odds with Penrose's work on the domestic firm. We claim that while Penrose's work was concerned primarily with value creation, she dealt explicitly with monopoly rents too. Her work on the multinational firm was in line with her analysis of the domestic firm. Moreover, her work has important prescriptive lessons for management practice.

Suggested Citation

  • Pitelis, Christos N., 2004. "Edith Penrose and the resource-based view of (international) business strategy," International Business Review, Elsevier, vol. 13(4), pages 523-532, August.
  • Handle: RePEc:eee:iburev:v:13:y:2004:i:4:p:523-532
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    References listed on IDEAS

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    1. Penrose, Perran & Pitelis, Christos, 1999. "Edith Elura Tilton Penrose: Life, Contribution and Influence," Contributions to Political Economy, Oxford University Press, vol. 18(0), pages 3-22.
    2. Yasemin Y. Kor & Joseph T. Mahoney, 2004. "Edith Penrose's (1959) Contributions to the Resource-based View of Strategic Management," Journal of Management Studies, Wiley Blackwell, vol. 41(1), pages 183-191, January.
    3. Demsetz, Harold, 1973. "Industry Structure, Market Rivalry, and Public Policy," Journal of Law and Economics, University of Chicago Press, vol. 16(1), pages 1-9, April.
    4. David J. Teece, 2003. "Towards an Economic Theory of the Multiproduct Firm," World Scientific Book Chapters,in: Essays In Technology Management And Policy Selected Papers of David J Teece, chapter 15, pages 419-446 World Scientific Publishing Co. Pte. Ltd..
    5. Penrose, Edith, 1973. "International Patenting and the Less-Developed Countries," Economic Journal, Royal Economic Society, vol. 83(331), pages 768-786, September.
    6. Young, Allyn A., 1928. "Increasing Returns and Economic Progress," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 38, pages 527-542.
    7. Teece, David J., 1980. "Economies of scope and the scope of the enterprise," Journal of Economic Behavior & Organization, Elsevier, vol. 1(3), pages 223-247, September.
    8. Rugman, Alan M, 1986. "New Theories of the Multinational Enterprise: An Assessment of Internalization Theory," Bulletin of Economic Research, Wiley Blackwell, vol. 38(2), pages 101-118, May.
    9. Foss, Nicolai J, 1999. "Edith Penrose, Economics and Strategic Management," Contributions to Political Economy, Oxford University Press, vol. 18(0), pages 87-104.
    10. Demsetz, Harold, 1988. "The Theory of the Firm Revisited," Journal of Law, Economics, and Organization, Oxford University Press, vol. 4(1), pages 141-161, Spring.
    11. Marris, Robin, 1999. "Edith Penrose and Economics," Contributions to Political Economy, Oxford University Press, vol. 18(0), pages 47-65.
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    Cited by:

    1. Pitelis, Christos & Argitis, George, 2009. "Factors influencing the Internationalisation of Firms: Micro Foundations of Macro Determinants," Papers DYNREG36, Economic and Social Research Institute (ESRI).
    2. repec:spr:manint:v:47:y:2007:i:2:d:10.1007_s11575-007-0008-2 is not listed on IDEAS
    3. repec:spr:manint:v:47:y:2007:i:2:d:10.1007_s11575-007-0012-6 is not listed on IDEAS
    4. repec:spr:manint:v:47:y:2007:i:2:d:10.1007_s11575-007-0016-2 is not listed on IDEAS
    5. Pitelis, Christos & Teece, David, 2009. "The (new) nature and essence of the firm," MPRA Paper 24317, University Library of Munich, Germany.
    6. Christos N. Pitelis, 2011. "Foreign Direct Investment and Economic Integration," Chapters,in: International Handbook on the Economics of Integration, Volume III, chapter 1 Edward Elgar Publishing.
    7. Tseng, Chiung-Hui & Lee, Ruby P., 2010. "Host environmental uncertainty and equity-based entry mode dilemma: The role of market linking capability," International Business Review, Elsevier, vol. 19(4), pages 407-418, August.
    8. Christos N. Pitelis & Pellumb Kelmendi, 2011. "European Industrial Policy: Perspectives, Trends and a Sustainability-focused New Framework," Chapters,in: International Handbook on the Economics of Integration, Volume II, chapter 2 Edward Elgar Publishing.
    9. Janis Kapler, "undated". "The Theory of the Firm, the Theory of Competition and the Transnational Corporation," Working Papers 6, University of Massachusetts Boston, Economics Department.
    10. Pitelis, Christos, 2007. "Edith Penrose and a learning-based perspective on the MNE and OLI," MPRA Paper 24318, University Library of Munich, Germany.
    11. repec:spr:manint:v:47:y:2007:i:2:d:10.1007_s11575-007-0010-8 is not listed on IDEAS
    12. Pitelis, Christos & Kelmendi, Pellumb, 2009. "The political economy of European anti-trust and industrial policy," MPRA Paper 23941, University Library of Munich, Germany.
    13. Pitelis, Christos, 2009. "Edith Penrose’s ‘The Theory of the Growth of the Firm’ Fifty Years Later," MPRA Paper 23180, University Library of Munich, Germany.
    14. Kyläheiko, Kalevi & Jantunen, Ari & Puumalainen, Kaisu & Saarenketo, Sami & Tuppura, Anni, 2011. "Innovation and internationalization as growth strategies: The role of technological capabilities and appropriability," International Business Review, Elsevier, vol. 20(5), pages 508-520, October.
    15. Pitelis, Christos, 2007. "A note on Cyert and March (1963) and Penrose (1959): A case for synergy," MPRA Paper 23939, University Library of Munich, Germany.
    16. Manuel Portugal Ferreira & Nuno Rosa Reis & Fernando Ribeiro Serra & Benny Kramer Costa, 2013. "Understanding the footprint of the RBV in International Business studies: The last twenty years of research," Working Papers 96, globADVANTAGE, Polytechnic Institute of Leiria.
    17. Loredana Volpe & Daniele Biferali, 2008. "Edith Tilton Penrose, The Theory of the Growth of the Firm," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 12(1), pages 119-125, March.
    18. Pitelis, Christos, 2009. "Foreign direct investment and economic integration," MPRA Paper 23938, University Library of Munich, Germany.
    19. repec:spr:manint:v:47:y:2007:i:2:d:10.1007_s11575-007-0011-7 is not listed on IDEAS
    20. Dutta, Dev K. & Beamish, Paul W., 2013. "Expatriate Managers, Product Relatedness, and IJV Performance: A Resource and Knowledge-based Perspective," Journal of International Management, Elsevier, vol. 19(2), pages 152-162.
    21. Pease, Stephanie & Paliwoda, Stanley & Slater, Jim, 2006. "The erosion of stable shareholder practice in Japan ("Anteikabunushi Kosaku")," International Business Review, Elsevier, vol. 15(6), pages 618-640, December.
    22. Manuel Portugal Ferreira & Fernando A. Ribeiro Serra & Benny Kramer Costa, 2011. "The RBV in International Business Studies: A bibliometric study of Barney?s (1991) contribution to the field," Working Papers 82, globADVANTAGE, Polytechnic Institute of Leiria.

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