Building Micro-Foundations for the Routines, Capabilities, and Performance Links

Peter Abell, Teppo Felin and Nicolai Foss ()

No 07-02, DRUID Working Papers from DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies

Abstract: Micro-foundations have become an important emerging theme in strategic management. This paper addresses micro-foundations in two related ways. First, we argue that the kind of macro (or “collectivist”) explanation that is utilized in the capabilities view in strategic management ? which implies a neglect of micro-foundations ? is incomplete. There are no mechanisms that work solely on the macro-level, directly connecting routines and capabilities to firm-level outcomes. While routines and capabilities are useful shorthand for complicated patterns of individual action and interaction, ultimately they are best understood at the micro-level. Second, we provide a formal model that shows precisely why macro explanation is incomplete and which exemplifies how explicit micro-foundations may be built for notions of routines and capabilities and for how these impact firm performance.

Keywords: Routines; capabilities; micro-foundations; production function (search for similar items in EconPapers)
JEL-codes: L2 M1 (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-bec, nep-cbe and nep-cse
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Journal Article: Building micro-foundations for the routines, capabilities, and performance links (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:aal:abbswp:07-02

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