Firm strategy, innovation and consumer demand: a market process approach
Despite recent advances by economists such as Porter and those associated with the resource-based school, the economics of demand rarely features in discussions of business strategy. Porter and the resource-based school take the characteristics of demand as given, and place almost exclusive emphasis on the role of supply-side factors in formulating strategy. Scholars in strategic marketing, by contrast, recognize the importance of demand factors, but do not analyse them from an economic standpoint. Moreover, none of the important schools of strategic management attempts to explore the relationship between supply and demand in much analytical depth. In this paper, we adopt a market process approach to strategy formulation as a preliminary step towards rectifying these problems. First, we explore the factors that affect the economics of demand, particularly in innovative situations. Second, we adapt Lancaster's attribute analysis to show how the interaction between supply and demand can be represented from a market process perspective. On the basis of our efforts, we conclude that further work in these areas would benefit students of both strategic management and economics. Copyright © 2001 John Wiley & Sons, Ltd.
Volume (Year): 22 (2001)
Issue (Month): 4-5 ()
|Contact details of provider:|| Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/7976|
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.:
- Richardson, G B, 1972. "The Organisation of Industry," Economic Journal, Royal Economic Society, vol. 82(327), pages 883-96, September.
- Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-96, September.
- Paque, Karl-Heinz, 1985. "How Far Is Vienna from Chicago? An Essay on the Methodology of Two Schools of Dogmatic Liberalism," Kyklos, Wiley Blackwell, vol. 38(3), pages 412-34.
- Richard N. Langlois & Metin M. Cosgel, 1996. "The Organization of Consumption," Working papers 1996-07, University of Connecticut, Department of Economics.
- Cheung, Steven N S, 1983. "The Contractual Nature of the Firm," Journal of Law and Economics, University of Chicago Press, vol. 26(1), pages 1-21, April.
- Ulrich Witt, 2006. "Evolutionary Economics," Papers on Economics and Evolution 2006-05, Philipps University Marburg, Department of Geography.
When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:22:y:2001:i:4-5:p:183-199. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.