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Equilibrium vs Evolution in the Resource-Based Perspective The Conflicting Legacies of Demsetz and Penrose

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  • Nicolai J. Foss

Abstract

This paper argues that not only Edith Penrose, but also Harold Demsetz should be seen as a dominant source of inspiration for RBP scholars, that these two crucial influences hold different and even conflicting views of the economic process, and that they helped found different research areas and research approaches within the RBP. Based on this discussion, the paper argues that the conflicting legacies of Penrose and Demsetz threathen the coherence of the RBP, that a central problem in the RBP is the lack of understanding of the process of resource-creation which tends to give the perspective a retrospective character, but that work on technological innovation and change, framed in the broader theoretical context of Austrian and evolutionary economics, may help remedy this shortcoming.

Suggested Citation

  • Nicolai J. Foss, 1997. "Equilibrium vs Evolution in the Resource-Based Perspective The Conflicting Legacies of Demsetz and Penrose," DRUID Working Papers 97-10, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
  • Handle: RePEc:aal:abbswp:97-10
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    File URL: https://wp.druid.dk/wp/19970010.pdf
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    References listed on IDEAS

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    1. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-337, May.
    2. 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.
    3. Spender, J. -C., 1994. "Organizational knowledge, collective practice and Penrose rents," International Business Review, Elsevier, vol. 3(4), pages 353-367, December.
    4. repec:bla:stratm:v:15:y:1994:i:s2:p:149-165 is not listed on IDEAS
    5. Foss, Nicolai J, 1998. "The Competence-Based Approach: Veblenian Ideas in the Modern Theory of the Firm," Cambridge Journal of Economics, Oxford University Press, vol. 22(4), pages 479-495, July.
    6. S.A. Lippman & R.P. Rumelt, 1982. "Uncertain Imitability: An Analysis of Interfirm Differences in Efficiency under Competition," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 418-438, Autumn.
    7. Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-131, March.
    8. Rubin, Paul H, 1973. "The Expansion of Firms," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 936-949, July-Aug..
    9. James G. March, 1991. "Exploration and Exploitation in Organizational Learning," Organization Science, INFORMS, vol. 2(1), pages 71-87, February.
    10. Nicolai J. Foss, 1996. "Research In Strategy, Economics, and Michael Porter," Journal of Management Studies, Wiley Blackwell, vol. 33(1), pages 1-24, January.
    11. Cynthia A. Montgomery & Birger Wernerfelt, 1988. "Diversification, Ricardian Rents, and Tobin's q," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 623-632, Winter.
    12. Cynthia A. Montgomery, 1994. "Corporate Diversificaton," Journal of Economic Perspectives, American Economic Association, vol. 8(3), pages 163-178, Summer.
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    Citations

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    Cited by:

    1. Richard K. Blundel & David J. Smith, 2013. "Reinventing artisanal knowledge and practice: a critical review of innovation in a craft-based industry," Prometheus, Taylor & Francis Journals, vol. 31(1), pages 55-73, March.
    2. Gérard Charreaux, 2002. "Variation sur le thème:"À la recherche de nouvelles fondations pour la finance et la gouvernance d'entreprise"," Revue Finance Contrôle Stratégie, revues.org, vol. 5(3), pages 5-68, September.
    3. John Finch, 2000. "Is post-Marshallian economics an evolutionary research tradition?," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 7(3), pages 377-406.

    More about this item

    Keywords

    Evolutionary economics; competences; ressource-based perspective;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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