Why do firms differ, and how does it matter?
Article first published online: 16 FEB 2007
Copyright © 1991 John Wiley & Sons, Ltd.
Strategic Management Journal
Special Issue: Special Issue
Volume 12, Issue S2, pages 61–74, Winter 1991
How to Cite
Nelson, R. R. (1991), Why do firms differ, and how does it matter?. Strat. Mgmt. J., 12: 61–74. doi: 10.1002/smj.4250121006
- Issue published online: 16 FEB 2007
- Article first published online: 16 FEB 2007
In virtually all economic analyses, differences among firms in the same line of business are repressed, or assumed to reflect differences in the market environments that they face. In contrast, for students of business management and strategy, firm differences are at the heart of their inquiry. This paper explores the reasons behind this stark difference in viewpoint. It argues that economists really ought to recognize firm differences explicitly.