A Historical Comparison of Resource-Based Theory and Five Schools of Thought Within Industrial Organization Economics: Do We Have a New Theory of the Firm?

A new theory of competition is evolving in the strategy literature. The authors explicate the foundations of this new theory, the “comparative advantage theory of competition,” and contrast them wi...

https://www.jstor.org/stable/pdfplus/1252069.pdf

The Comparative Advantage Theory of Competition

The Theory of Monopolistic Competition.

We decompose the inter-firm variance in profit rates into economic and organizational components. Using a representative model from each paradigm we find that both sets of factors are significant determinants of firm performance. Further findings are that the two effects are roughly independent and that organizational factors explain about twice as much variance in profit rates as economic factors.

/pdf/determinants-of-firm-performance-the-relative-importance-of-4ungjlz2a2.pdf

Determinants of firm performance: the relative importance of economic and organizational factors

Prior work has shown an association between diversification strategy and profitability. This paper replicates that association using more recent and complete data and goes on to investigate the sources of the association. Theoretical arguments are advanced which predict the association which will remain once the effects of varying industry profitability are removed. Empirical tests verify this prediction and permit the discrimination between the effects of industry and diversification strategy on profitability.

https://www.jstor.org/stable/pdfplus/2486302.pdf

Diversification strategy and profitability

HE field of industrial organization has acT quired an abundance of hypotheses about what comprises market structure.1 Neoclassical analysis was premised on the firm's market share, atomistic or pure monopoly. Then came the Chamberlinian group of the 1930's, Bain's entry barriers of the 1950's, and firm size and advertising in the 1960's. This abundance yields vitality, but it has also left uncertain the relative importance and interrelations of the individual structural elements. Empirical analyses, relying mainly on partial tests relating one or two elements with a dimension of behavior, have not resolved the patterns. This paper attempts to compose these differences by fitting models of structure to recent data on large United States industrial corporations. Section I prepares testable models of the elements, both in static and in comparativestatic contexts. Data on a panel of 231 large United States industrial firms during 19601969 are described in section II. Section III presents the empirical analysis, and the results are summarized in section IV.

The Elements of Market Structure

RECENT research on employment discrimination against blacks and women suggests that no single determinant education, location, growth, or others is primary. Yet the belief persists (see Alchian and Kessel, 1962; Arrow, 1971; Ashenfeiter, 1969; Becker, 1957; Bergmann, 1971; Comanor, 1971; Shepherd, 1969; Thurow, 1969) that the employers' power to choose may be important, via their managerial preferences and discretionary resources. These influences would be visible in large industrial firms which possess market power. In this paper we test whether the industrial structure and performance of large firms have in fact been related to their employment of blacks and women. The analysis covers about 200 of the largest United States industrial enterprises, using employment data for 1966 and 1970. The focus is on white-collar employment patterns. Being more directly subject to upper management control than is blue-collar employment, the white-collar patterns may provide a sensitive test of whatever role is played by "enterprise policy" under varying conditions and constraints. First we discuss the basic hypotheses to be tested in section I. Section II explains the variables and the basic models which are to be analyzed. Section III presents the empirical results. And finally, the findings are summarized in section IV.

Managerial Discrimination in Large Firms

Examines the sources of increased competition in the United States (U.S.) between 1939 to 1980. In this paper authors consider the review of related literature, trends and patterns of competitive structure in the U.S. economy, influence of antirust actions on competition.

Causes of increased competition in the US economy, 1939-1980

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The Elements of Market Structure

Managerial Discrimination in Large Firms

Causes of increased competition in the US economy, 1939-1980