Adapting to market liberalization: The role of dynamic capabilities, initial resource conditions, and strategic path choices in determining evolutionary fitness of Less Developed Country (LDC) firms
Economic liberalization leads to higher competitive intensity that spurs strategic changes in LDC domestic firms. I apply the dynamic capabilities lens to post-liberalization adaptation of LDC domestic firms. Based upon the logic of fit, I argue that initial resource conditions, strategic paths, and requisite dynamic capabilities must match to enhance evolutionary fitness of firms. I propose that LDC firms with strong core and complementary capabilities will adopt strategies of increasing scale and scope, along with cultivating an acquisition dynamic capability to enhance fitness. LDC firms with weak core but strong complementary capabilities could enhance fitness by forming rent-creating alliances with Multinational Enterprises (MNE), and building relational dynamic capabilities. Finally, LDC firms with weak core and complementary capabilities can gain benefits towards fitness by enacting political strategies supported by political dynamic capabilities.
Volume (Year): 14 (2008)
Issue (Month): 3 (September)
|Contact details of provider:|| Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/601266/description#description|
|Order Information:|| Postal: http://www.elsevier.com/wps/find/journaldescription.cws_home/601266/bibliographic|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Yasemin Y. Kor & Joseph T. Mahoney & Steven C. Michael, 2007. "Resources, Capabilities and Entrepreneurial Perceptions," Journal of Management Studies, Wiley Blackwell, vol. 44(7), pages 1187-1212, November.
- Williamson, Oliver E, 1983. "Credible Commitments: Using Hostages to Support Exchange," American Economic Review, American Economic Association, vol. 73(4), pages 519-40, September.
- Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-28, June.
- Constance E. Helfat & Marvin B. Lieberman, 2002. "The birth of capabilities: market entry and the importance of pre-history," Industrial and Corporate Change, Oxford University Press, vol. 11(4), pages 725-760, August.
- Michael G. Jacobides, 2006. "The architecture and design of organizational capabilities," Industrial and Corporate Change, Oxford University Press, vol. 15(1), pages 151-171, February.
- Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and Sustainability of Competitive Advantage," Management Science, INFORMS, vol. 35(12), pages 1504-1511, December.
- James R. Tybout, 2000.
"Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?,"
Journal of Economic Literature,
American Economic Association, vol. 38(1), pages 11-44, March.
- James Tybout, 1998. "Manufacturing Firms In Developing Countries: How Well Do They Do, And Why?," Development and Comp Systems 9805004, EconWPA.
- James Tybout, 1999. "Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?," Development and Comp Systems 9906001, EconWPA, revised 10 Jun 1999.
- Tybout, James, 1998. "Manufacuring firms in developing countries - how well do they do, and why?," Policy Research Working Paper Series 1965, The World Bank.
- Teece, David J., 1993.
"Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy,"
Elsevier, vol. 22(2), pages 112-113, April.
- Teece, David J., 1986. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," Research Policy, Elsevier, vol. 15(6), pages 285-305, December.
- Stegemann, Klaus, 1989. "Policy rivalry among industrial states: what can we learn from models of strategic trade policy?," International Organization, Cambridge University Press, vol. 43(01), pages 73-100, December.
- Lecraw, Donald J, 1977. "Direct Investment by Firms from Less Developed Countries," Oxford Economic Papers, Oxford University Press, vol. 29(3), pages 442-57, November.
- Baumol, William J, 1990. "Entrepreneurship: Productive, Unproductive, and Destructive," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 893-921, October.
- Mahoney, Joseph T., 1995. "The management of resources and the resource of management," Journal of Business Research, Elsevier, vol. 33(2), pages 91-101, June.
- Juha-Antti Lamberg & Henrikki Tikkanen, 2006. "Changing sources of competitive advantage: cognition and path dependence in the Finnish retail industry 1945--1995," Industrial and Corporate Change, Oxford University Press, vol. 15(5), pages 811-846, October.
- Teece, David J., 2006. "Reflections on "Profiting from Innovation"," Research Policy, Elsevier, vol. 35(8), pages 1131-1146, October.
- William P. Wan, 2005. "Country Resource Environments, Firm Capabilities, and Corporate Diversification Strategies," Journal of Management Studies, Wiley Blackwell, vol. 42(1), pages 161-182, 01.
- Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and the Sustainability of Competitive Advantage: Reply," Management Science, INFORMS, vol. 35(12), pages 1514-1514, December.
- Louis T. Wells, 1983. "Third World Multinationals: The Rise of Foreign Investments from Developing Countries," MIT Press Books, The MIT Press, edition 1, volume 1, number 026273169x, December.
- Helfat, C.E. & Raubitschek, R.S., 2000. "Product Sequencing: Co-Evolution of Knowledge, Capabilities and Products," Papers 00-1, U.S. Department of Justice - Antitrust Division.
When requesting a correction, please mention this item's handle: RePEc:eee:intman:v:14:y:2008:i:3:p:217-231. See general information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.