Organizational Economics of Capability and Heterogeneity

Argyres, Nicholas S., Felin, Teppo, Foss, Nicolai J. and Zenger, Todd R. (2012) Organizational Economics of Capability and Heterogeneity. Organization Science, 23 (5). pp. 1213-1226.


For decades, the literatures on firm capabilities and organizational economics have been at odds with each other, specifically relative to explaining organizational boundaries and heterogeneity. We briefly trace the history of the relationship between the capabilities literature and organizational economics and point to the dominance of a “capabilities first” logic in this relationship. We argue that capabilities considerations are inherently intertwined with questions about organizational boundaries and internal organization, and use this point to respond to the prevalent “capabilities first” logic. We offer an integrative research agenda that focuses, first, on the governance of capabilities and, second, on the capability of governance.

Item Type: Article
Keywords: Organizational economics, theory of the firm, heterogeneity, capabilities
Subject(s): Strategy; Entrepreneurship & Global business
Centre: Faculty of Strategy, Entrepreneurship and International Business
Date Deposited: 22 Oct 2015 09:25
Last Modified: 23 Oct 2015 14:08
Funders: Norwegian School of Economics

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