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An emerging theory of the firm, the knowledge-based view (KBV) considers a firm's knowledge as the most strategically significant resource of a firm. Originating from the strategic management literature, this perspective builds upon and extends the resource-based view (RBV) of the firm initially promoted by Edith Penrose in her book, The Theory of the Growth of the Firm (1959) and later expanded by others. Although the RBV recognizes the important role of knowledge in firms that achieve a competitive advantage, the KBV argues that knowledge, unlike generic resources, has special characteristics. In fact, proponents of the KBV argue that firms exist because they better integrate and apply specialized knowledge than do markets and can better protect knowledge from expropriation and imitation than can markets. Thus, ...

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