This book develops a property rights approach to firm strategy and demonstrates how it helps address key challenges in strategic management research. It shows that the property rights approach holds important implications both for entrepreneurship and organizational learning theory.
Property rights have direct implications for strategic management, as control over assets has an immediate link to the creation and appropriation of economic value. For a firm to execute a competitive strategy, it must hold rights to appropriate resources.
This book will appeal to scholars working in the fields of strategic management, organizational theory and resource allocation. It is an invaluable summary of two decades of groundbreaking research.
Author(s): Kirsten Foss, Nicolai J. Foss
Publisher: Palgrave Macmillan
Year: 2022
Language: English
Pages: 291
City: Cham
Preface and Acknowledgments
Contents
List of Figures
List of Tables
1 Strategy and Property Rights
Property Rights Economics in the Conversation of Strategy Researchers
The Importance of Strategy Research
Economics and Strategy
The Distinctiveness of This Book
Property Rights and Other Approaches in Strategy Research
Property Rights Economics: New Old Insights
Relevance to Strategy and Overview of the Book
Value Creation
Positioning Theory and Barriers to Strategizing
The Theory of the Firm, Learning, and Entrepreneurship
References
2 Microfoundations for Strategy
The Structure of Microfoundations
Which Microfoundations for Strategy?
Conclusions
References
3 Property Rights Economics: An Overview
The Evolution of Thinking on Property Rights in Economics
Early Thinking
The Emergence of Property Rights Economics
The Current Status of Property Rights Economics
Key Tenets of Property Rights Economics
The Forms of Property
An Extension of “Standard” Economics
The “Coase Theorem”
The Coase Theorem as an Evolving Benchmark
Property Rights and Transaction Costs
Conclusion
References
4 Ownership and Property Rights
Ownership in Property Rights Economics (Mark I)
The New Property Rights Economics
Comparing Mark I and Mark II Property Rights Economics
Cutting the Gordian Knot?
How Well-Defined is Ownership?
Do These Distinctions Matter?
A New Lighthouse in Economics?
Consequences and Anomalies
Toward a Broader Understanding of Ownership Patterns
An Example
Implications
Conclusion
References
5 Resources and Value Creation
Refining Resource Analysis: Property Rights and Resource Value
Resources as Bundles of Property Rights
Resource Value and Transaction Costs
Controlling Property Rights: The Capture and Protection of Property Rights
Relating Transaction Costs to Value Creation and Appropriation
The Coase Theorem
Value Dissipation and Value Erosion: Bad News for Strategizers
Sources of Value Creation: Good News for Strategizers
Transaction Costs and Sustained Competitive Advantage
Conclusions
References
6 Strategizing and Positioning
Theoretical Foundations
Property Rights and Transaction Costs
Implicit Property Rights and Transaction Costs in Competitive Strategy Research
Enter Transaction Costs
Property Rights and Transaction Cost Conditions of Successful Strategizing
Extended Rivalry and Countervailing Power
Building Market Power
Protecting Market Power
Exercising Market Power
Summary
Differentiating Transaction Costs: Implications for Strategic Positioning
Transaction Costs of Delineating, Exchanging, and Protecting Property Rights
The Transaction Cost Environment and Transaction Cost Arrangements
Concluding Discussion
Contribution to Theory
Strategizing and Economizing
Future Research
References
7 Property Rights and the Nature of the Firm
Coase’s “The Nature of the Firm”
Transaction Costs and Subjective Opportunity Costs
Coase and the Firm: Coordination and Property Rights
Property Rights and the Firm
Conclusions
References
8 The Theory of the Firm: Specialization and Learning
Specialization: A Property Rights Interpretation
Specialization
Learning by Doing
Delineating Property Rights
The Division of Labor, Learning by Doing, and Property Rights
Coordination and Experimentation in Production
Specialization and Coordination
Other Determinants of the “Costs of Discovering the Relevant Prices”
Make or Buy Decisions: Taking Advantage of the Division of Labor
Conclusion
References
9 Property Rights, Transaction Costs, and Entrepreneurship
Opportunity Discovery and Experiential Knowledge
Opportunity Discovery
Experiential Knowledge
Cognition and Incentives in Opportunity Discovery
Linking Transaction Costs and Opportunity Discovery: Appropriability and Resource Learning Mechanisms
Attributes and Opportunity Discovery
The Appropriability Mechanism
The Resource Learning Mechanism
Opportunity Discovery and Sustainable Advantage: A Framework for Analysis
Benchmarks
Case A: Zero Transaction Costs and Blueprint Knowledge
Case B: Zero Transaction Costs and Non-blueprint Knowledge
Case C: Positive Transaction Costs and Blueprint Knowledge
Case D: Positive Transaction Costs and Non-blueprint Knowledge
Conclusions
References
10 Conclusions
References
References
Index
