Pitelis, Christos (2007): A note on Cyert and March (1963) and Penrose (1959): A case for synergy. Published in: Organization Science , Vol. 18, No. 3
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Cyert and March’s 1963 seminal book is one of the two major economics-based theories of the firm that goes inside the ‘black box’ (the firm) – the other being the contribution of Edith Penrose. The two theories have differences, but also similarities, and substantial scope for cross-fertilisation that have gone unnoticed in the literature. In this note we try to integrate important ideas in both books, paying particular attention to the issue of ‘excess resources’ /slack, and (intra-firm) conflict. We then build on the integrated framework by delving into the nature of intra-firm conflict, the degree of intra-firm rivalry and the relationship between firm performance and ‘productive opportunity’. We derive propositions common to the two theories, but also new ones, of import to our understanding of organisational growth and change.
|Item Type:||MPRA Paper|
|Original Title:||A note on Cyert and March (1963) and Penrose (1959): A case for synergy|
|Keywords:||Behavioral theory of the firm, Edith Penrose, excess resources, slack, conflict, innovation|
|Subjects:||M - Business Administration and Business Economics; Marketing; Accounting > M2 - Business Economics > M21 - Business Economics|
|Depositing User:||Christos Pitelis|
|Date Deposited:||26. Jul 2010 11:12|
|Last Modified:||13. Feb 2013 21:57|
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