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Research In Strategy, Economics, and Michael Porter

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  • Nicolai J. Foss

Abstract

This article links up with recent discussions of the strategy/economics nexus. In contrast to most of the proponents and opponents of economics in strategy thinking, a balanced pluralist perspective is adopted. According to this, a discipline should strike a balance between the generation of new theoretical alternatives and the selection among them. Applying this general idea, I argue that the strategy field is too pluralistic, and that the unfortunate consequences of excessive pluralism and eclecticism may be remedied by economics playing a larger role in the conversation of strategy researchers. This does not necessarily mean standard neoclassical economics or new industrial organization economics; evolutionary economics, for example, is a serious contender, too. the evolution of Michael Porter's thinking is used as a case for demonstrating some of the advantages and some of the dangers of economics in the strategy field, and for illustrating points about eclecticism and pluralism.

Suggested Citation

  • Nicolai J. Foss, 1996. "Research In Strategy, Economics, and Michael Porter," Journal of Management Studies, Wiley Blackwell, vol. 33(1), pages 1-24, January.
    • Handle: RePEc:bla:jomstd:v:33:y:1996:i:1:p:1-24
    DOI: 10.1111/j.1467-6486.1996.tb00796.x
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    1. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, April.
    2. Baumol, William J, 1982. "Contestable Markets: An Uprising in the Theory of Industry Structure," American Economic Review, American Economic Association, vol. 72(1), pages 1-15, March.
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    2. Fernández-Olmos, Marta & Díez-Vial, Isabel, 2013. "Effect of firm’s resources on international diversification: An application in the Iberian Ham industry," European Management Journal, Elsevier, vol. 31(2), pages 196-208.
    3. John Dunning, 2001. "The Eclectic (OLI) Paradigm of International Production: Past, Present and Future," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 8(2), pages 173-190.
    4. Sylvia Maxfield, 2008. "Reconciling Corporate Citizenship and Competitive Strategy: Insights from Economic Theory," Journal of Business Ethics, Springer, vol. 80(2), pages 367-377, June.
    5. Richard N. Langlois, 2001. "Strategy and the market process: introduction to the Special Issue," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 22(4-5), pages 163-168.
    6. S. J. Fowler & C. Hope, 2007. "Incorporating sustainable business practices into company strategy," Business Strategy and the Environment, Wiley Blackwell, vol. 16(1), pages 26-38, January.
    7. Johansson, Magnus & Jonsson, Anna, 2012. "The package logic: A study on value creation and knowledge flows," European Management Journal, Elsevier, vol. 30(6), pages 535-551.
    8. David J. Brooksbank & David G. Pickernell, 1999. "Regional Competitiveness Indicators," Local Economy, London South Bank University, vol. 13(4), pages 310-326, February.
    9. Asma Zgarni, 2019. "Cooperation or Coopetition Strategy: What is the Best Strategy Face to Competition’ Intensity and Strategic Capabilities?," International Review of Management and Marketing, Econjournals, vol. 9(5), pages 114-124.
    10. Foss, Nicolai J., 1998. "The resource-based perspective: An assessment and diagnosis of problems," Scandinavian Journal of Management, Elsevier, vol. 14(3), pages 133-149, March.
    11. Paul L. Robertson & Tony F. Yu, 2001. "Firm strategy, innovation and consumer demand: a market process approach," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 22(4-5), pages 183-199.
    12. Christos Pitelis, 2005. "Edith Penrose, organisational economics and business strategy: an assessment and extension," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 67-82.
    13. Finch, John H. & Macmillan, Fiona E. & Simpson, Graeme S., 2002. "On the diffusion of probabilistic investment appraisal and decision-making procedures in the UK's upstream oil and gas industry," Research Policy, Elsevier, vol. 31(6), pages 969-988, August.
    14. J. C. Sharmiladevi, 2017. "Understanding Dunning’s OLI Paradigm," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 8(3), pages 47-52, September.
    15. Rudawska, Iga, 2010. "Interconnected firms’ relationships as a source of a competitive advantage," Business and Economic Horizons (BEH), Prague Development Center (PRADEC), vol. 2(2), pages 1-10, July.
    16. Eric Lamarque, 1999. "Les activités clés des métiers bancaires: une analyse par la chaîne de valeur," Revue Finance Contrôle Stratégie, revues.org, vol. 2(2), pages 135-158, June.
    17. Esthela Galván-Vela & Eduardo Arango Herrera & Deisy Milena Sorzano Rodríguez & Rafael Ravina-Ripoll, 2021. "State-of-the-Art Analysis of Intrapreneurship: A Review of the Theoretical Construct and Its Bibliometrics," JRFM, MDPI, vol. 14(4), pages 1-16, April.
    18. Monika Klemke-Pitek & Magdalena Majchrzak, 2022. "Pro-Ecological Activities and Shaping the Competitive Advantage of Small and Medium-Sized Enterprises in the Aspect of Sustainable Energy Management," Energies, MDPI, vol. 15(6), pages 1-23, March.
    19. Richard N. Langlois, 2003. "Strategy as economics versus economics as strategy," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 24(4), pages 283-290.
    20. Dunning, John H., 2000. "The eclectic paradigm as an envelope for economic and business theories of MNE activity," International Business Review, Elsevier, vol. 9(2), pages 163-190, April.
    21. Luiz Claudio Louzada & Márcio Augusto Gonçalves, 2018. "The Moderating Effect of the Sector’s Level of Concentration on the Relationship Between Balance Sheet Composition and the Firm’s Competitive Advantage," Brazilian Business Review, Fucape Business School, vol. 15(6), pages 512-532, November.
    22. 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.

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