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Organization, Evolution, Cognition and Dynamic Capabilities

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  • Bart Nooteboom

Abstract

Using insights from ‘embodied cognition’ and a resulting ‘cognitive theory of the firm’, The paper aims to contribute to the further development of evolutionary theory of organizations, in the specification of organizations as ‘interactors’ that carry organizational competencies as ‘replicators’, within industries as ‘populations’. The paper, in particular, analyzes how, if at all, ‘dynamic capabilities’ can be fitted into evolutionary theory, and proposes that the prime purpose of an organization is to serve as a cognitive ‘focusing device’. Here, cognition has a wide meaning, including perception, interpretation, sense making, and value judgments. The paper examines how cognition integrates organizations on the one hand, and creates differences within and between industries on the other, and proposes the following sources of ‘variation’ replication in communication, novel combinations of existing knowledge, and a path of discovery by which exploitation leads to exploration. These sources yield a proposal for dynamic capabilities. The paper also discusses in what sense, and to what extent these sources of variation are ‘blind’, as postulated in evolutionary theory.

Suggested Citation

  • Bart Nooteboom, 2007. "Organization, Evolution, Cognition and Dynamic Capabilities," The IUP Journal of Managerial Economics, IUP Publications, vol. 0(4), pages 31-55, November.
  • Handle: RePEc:icf:icfjme:v:05:y:2007:i:4:p:31-55
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    References listed on IDEAS

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    1. Wuyts, Stefan & Colombo, Massimo G. & Dutta, Shantanu & Nooteboom, Bart, 2005. "Empirical tests of optimal cognitive distance," Journal of Economic Behavior & Organization, Elsevier, vol. 58(2), pages 277-302, October.
    2. Ulrich Witt, 2004. "On the proper interpretation of 'evolution' in economics and its implications for production theory," Journal of Economic Methodology, Taylor & Francis Journals, vol. 11(2), pages 125-146.
    3. Geoffrey M. Hodgson, 2002. "Darwinism in economics: from analogy to ontology," Journal of Evolutionary Economics, Springer, vol. 12(3), pages 259-281.
    4. Geoffrey Hodgson, 2002. "The Legal Nature of the Firm and the Myth of the Firm-Market Hybrid," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 9(1), pages 37-60.
    5. Nooteboom, Bart & Van Haverbeke, Wim & Duysters, Geert & Gilsing, Victor & van den Oord, Ad, 2007. "Optimal cognitive distance and absorptive capacity," Research Policy, Elsevier, vol. 36(7), pages 1016-1034, September.
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    Citations

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    Cited by:

    1. Alessandra Colombelli & Jackie Krafft & Francesco Quatraro, 2012. "The emergence of new technology-based sectors at the regional level: a proximity-based analysis of nanotechnology," Papers in Evolutionary Economic Geography (PEEG) 1211, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Jun 2012.
    2. Colombelli, Alessandra & Krafft, Jackie & Quatraro, Francesco, 2014. "The emergence of new technology-based sectors in European regions: A proximity-based analysis of nanotechnology," Research Policy, Elsevier, vol. 43(10), pages 1681-1696.
    3. Huang, Tsu-Te (Andrew) & Chen, Le & Stewart, Rodney A. & Panuwatwanich, Kriengsak, 2013. "Leveraging power of learning capability upon manufacturing operations," International Journal of Production Economics, Elsevier, vol. 145(1), pages 233-252.
    4. Slowak, André P., 2009. "Market fields structure & dynamics in industrial automation," FZID Discussion Papers 02-2009, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    5. A. Madureira & F. Hartog & N. Baken, 2016. "A holonic framework to understand and apply information processes in evolutionary economics: survey and proposal," Netnomics, Springer, vol. 17(2), pages 157-190, September.

    More about this item

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary

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