A General Theory of Competition: Resources, Competences, Productivity, Economic Growth

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Shelby D. Hunt

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  • Marketing for a New Century: A Sage Publication Series

    Series Editor

    Naresh K. Malhotra

    The Marketing for a New Century series examines current and emerging issues in the field of marketing. Written by researchers who are widely acknowledged subject area experts, the books provide an authoritative, up-to-date review of the conceptual, research, and practical implications of the major issues in the marketing discipline.

    A GENERAL THEORY OF COMPETITION by Shelby Hunt is the first volume in the series. Future volumes now in development will create a library of current, state-of-the-art texts and supplements for advanced courses in the marketing curriculum.

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    I thank the following for permission to reprint:

    Excerpts from Human Action: A Treatise on Economics, Fourth Revised Edition, by Ludwig von Mises. Copyright © 1949, 1963 by Yale University Press, copyright © renewed 1996 by Bettina Bien Greaves. Used by permission of the Estate of Ludwig von Mises.

    Excerpts reprinted by permission of the publisher from The Theory of Monopolistic Competition: A Re-Orientation of the Theory of Value by Edward Hastings Chamberlin, Cambridge, Mass.: Harvard University Press. Copyright © 1933, 1937, 1938, 1942, 1948, 1956, 1962, 1970 by The President and Fellows of Harvard College, © 1961, 1965, 1966 by Edward Hastings Chamberlin, © 1976 by Luciann Chamberlin.

    Excerpts from Individualism and Economic Order, by Friedrich A. Hayek, 1948, Chicago: University of Chicago Press. Copyright © 1948 by the University of Chicago Press. Reprinted with permission.

    Excerpt from “A Survey of International Finance: The Ebb Tide,” The Economist, April 27, 1991, special section, p. 44. Copyright © 1991 The Economist Newspaper Group, Inc. Reprinted with permission. Further reproduction prohibited. http://www.economist.com

    Excerpts from “The New Breed of Strategic Planner,” Business Week, September 17, 1984, pp. 62–66, 68. Used with permission.

    Dedication

    This book is dedicated to my absolutely marvelous grandchildren, Megan and Collin

    Preface

    This book develops the structure, foundations, and implications of the resource-advantage (“R-A”) theory of competition. This new theory, it is argued, is a general, interdisciplinary, evolutionary, disequilibrium-provoking, process theory of competition. R-A theory has been developed in a sequence of more than a dozen journal articles that my friend and coauthor, Robert M. Morgan, and I have written for journals in economics, management, marketing, and public policy. The original idea for this book was to integrate and summarize the dozen articles in a monograph. However, as readers familiar with the separate articles will attest, this book extends the topics that R-A theory addresses substantially beyond the published articles, especially in such areas as economic growth and public policy.

    Readers should be alert to three stylistic features of this book that differentiate it from most monographs. First, because R-A theory is a genuinely interdisciplinary theory, much more space is allocated to “literature review” than one finds in most books. Indeed, three chapters out of ten are specifically devoted to the “antecedents and affinities” of resource-advantage theory. Some readers may find the attention devoted to the research traditions on which resource-advantage theory draws (or shares affinities with) to exceed their comfort level. Nonetheless, I believe it to be a scientific and moral imperative to give credit to those works in the “pedigree” of resource-advantage theory. I ask readers' indulgence for the extensive review of traditions with which they are unfamiliar.

    The second difference stems from the first. Even for an academic book, approximately six hundred references are a lot. Given that academic disciplines are rapidly becoming disciplinary “silos,” for publishing purposes one normally must cite only those sources in the specific research tradition in which one writes. Because resource-advantage theory is genuinely interdisciplinary, works in different research traditions must be cited, even when such works involve similar treatments of similar topics. Again, I ask readers' indulgence.

    The third stylistic difference concerns the extensive use of direct quotations. Regrettably, it is becoming commonplace, even in academic books, to simply paraphrase the works of others. In contrast, this book makes extensive use of direct quotations. I believe one has a scientific and moral imperative to accurately characterize the works of authors discussed, especially when one can be viewed as being critical of such works. The extensive use of direct quotations shows readers and original authors where to look for attributed views; they can then determine whether there might possibly be some misinterpretation or mischaracterization.

    Most readers will disagree with some parts of resource-advantage theory. Some readers will disagree with most of it. Such disagreement is welcomed, since a major objective of this monograph is to stimulate thoughtful discussion and empirical research concerning the nature of competition. I only hope that I have made the structure and foundations of the theory clear enough to assist critics in their efforts to show where it is in error or poorly developed. I would rather be found wrong than obtuse.

    Many scholars are working on developing process theories of competition. Indeed, many are referenced in this book. I invite all scholars developing process theories in economics, economic sociology, management, and marketing to (1) explicate their theories' structures and foundational premises and (2) compare and contrast them with R-A theory's structure (see Figures 6.1 and 6.2) and foundations (see Table 5.1). Then, we can evaluate how and why the theories are consistent or inconsistent, are saying different things or saying the same things differently, are genuinely rival or actually complementary.

    First on my list of acknowledgments must be Robert M. Morgan at the University of Alabama. A longtime friend and coauthor, Rob has provided significant input to developing the structure and foundations of R-A theory. Without him, it is fair to say, the theory would never have been developed. Rob, thank you.

    Numerous scholars here at Texas Tech University have provided significant input to the theory's development, including Dennis B. Arnett, Larry M. Austin, Kim Boal, Dale F. Duhan, Patrick Dunne, Roy D. Howell, James Jonish, C. Jay Lambe, Deborah Laverie, Jamie Oliver, Robert L. Phillips, R. Stephen Sears, Samuel Spralls, Alex Stewart, James B. Wilcox, and Robert E. Wilkes. I appreciate very much not only their technical assistance on many issues but also their encouraging me to undertake this task.

    A host of scholars in economics, management, marketing, and sociology have had a significant input to the development of the theory and the preparation of this book. I would like to specifically acknowledge the help of Jay Barney, Sundar G. Bharadwaj, S. Tamer Cavusgil, William W. Cooper, K. Chris Cox, Peter R. Dickson, Tom Donaldson, Henrik J. Duus, Steve Edison, Amitai Etzioni, Andreas Falkenberg, O. C. Ferrell, Nicolai J. Foss, Steve German, Aimé Heene, Geoffrey Hodgson, Bob Hopkins, Robert Jacobson, Israel M. Kirzner, Peter Klein, John Legge, Robert F. Lusch, William McKinley, Anil Menon, Richard R. Nelson, Paul Ngobo, Michael O'Keeffe, William D. Perrault, Robert A. Peterson, Peter Roberts, Paul Robertson, Ron Sanchez, Ronald Savitt, William R. Schroder, Robert M. Solow, John R. Sparks, P. Rajan Varadarajan, and Ulrich Witt. Of course, all the customary caveats apply.

    All those who have attempted to find publishers for works that have small markets know the difficulty of the task. Therefore, I should like to thank Sage Publications for agreeing to publish this work and, in particular, to thank Harry M. Briggs and Naresh K. Malhotra for their work as editors.

    Finally, but very important, thanks go to Mary Bishop and Robin Kirkland for their excellent typing assistance.

    S. D.HUNT
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    Author Index

    About the Author

    Shelby D. Hunt is the J. B. Hoskins and P. W. Horn Professor of Marketing at Texas Tech University, Lubbock, Texas. A past editor of the Journal of Marketing (1985–1987), and author of Modern Marketing Theory: Critical Issues in the Philosophy of Marketing Science (1991), he has numerous articles on competitive theory, macromarketing, ethics, channels of distribution, philosophy of science, and marketing theory. Three of his Journal of Marketing articles, “The Nature and Scope of Marketing” (1976), “General Theories and Fundamental Explananda of Marketing” (1983), and “The Comparative Advantage Theory of Competition” (1995), have won the Harold H. Maynard Award for the “best article on marketing theory.” He received the 1986 Paul D. Converse Award from the American Marketing Association for his contributions to theory and science in marketing. He received the 1987 Outstanding Marketing Educator Award from the Academy of Marketing Science and the 1992 American Marketing Association/Richard D. Irwin Distinguished Marketing Educator Award.


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