Year: 2007
Type: report
Abstract: Cyert and March’s 1963 seminal book is one of the two major economics-based theories of\nthe firm that goes inside the ‘black box’ (the firm) – the other being the contribution of Edith\nPenrose. The two theories have differences, but also similarities, and substantial scope for\ncross-fertilisation that have gone unnoticed in the literature. In this note we try to integrate\nimportant ideas in both books, paying particular attention to the issue of ‘excess resources’\n/slack, and (intra-firm) conflict. We then build on the integrated framework by delving into\nthe nature of intra-firm conflict, the degree of intra-firm rivalry and the relationship between\nfirm performance and ‘productive opportunity’. We derive propositions common to the two\ntheories, but also new ones, of import to our understanding of organisational growth and\nchange.
Author: Christos N. Pitelis
Institution: University of Cambridge
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2107116808