2005
(with Kirsten Foss) “Value and Transaction Costs: How the Economics of Property Rights Furthers the RBV,” Strategic Management Journal 26: 541-553.
Property rights economics furthers the resource-based view of strategic management in a number of ways. First, resources are conceptualized as being composed of multiple attributes for which property rights may be held. Second, a resource owner's ability to create, appropriate, and sustain value from resources depends on the property rights that he or she holds and on the transaction costs of exchanging, defining, and protecting them. While transaction costs are a major source of value dissipation, reducing such dissipation may create value. Implications for the RBV analysis of sustained competitive advantage are derived.
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(with Keld Laursen) “Performance Pay, Delegation, and Multitasking Under Uncertainty and Innovativeness: an Empirical Investigation,” Journal of Economic Behavior and Organization 58: 246-276.
It has been recently noted that the trade-off between risk and incentives that agency theory predicts turns out to be rather weak. We examine predictions from agency theory on the basis of data from a data set encompassing close to 1000 Danish firms. We find that the relation between performance pay and environmental uncertainty is indeed weak. We examine the relation between delegation and environmental uncertainty, and find that this relation is confirmed. We also examine the multi-tasking agency hypothesis that as risk increases, the flexibility of agents is restricted. We fail to find support for this hypothesis.
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(with Teppo Felin) “Strategic Organization: a Field in Search of Microfoundations.” Strategic Organization 3: 441-455. (Awarded the "SO!WHAT" Awards for Scholarly Contribution for Volume 3 (2005) of SO!)
Our particular focus in this essay is on the organizational capabilities-based literature in strategic management. This focus serves as a specific example of a more general problem of lack of attention to individuals in strategic organization. (Wider implications could be explicated given more space.) As brief support for the fact that our discussion does have wider ramifications, we note that Selznick has also quite poignantly raised the need for micro-foundations on the part of institutional scholars (1996: 274). Whetten (2004) also highlights the fact that scholars are rarely explicit about what they mean by ‘organizational’.
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(with Torben Andersen) “Strategic Opportunity and Economic Performance in Multinational Enterprises: The Role and Effects of Information and Communication Technology,” Journal of International Management 11: 293-310.
Recent work on multinational enterprises (MNEs) argues that diversity in terms of the markets they serve and the environments they acquire inputs from provides strategic opportunity unavailable to purely domestic firms. However, MNEs are also exposed to higher levels of complexity and uncertainty due to the presence in different locations and confront associated needs to integrate and coordinate activities. This paper suggests that the attendant cost–benefit tradeoff can be influenced by computer-mediated communication. Based on a sample of 88 organizations in the computer products industries, we find that multinationality in itself does not guarantee a higher level of strategic opportunity. Instead, use of information technology to facilitate communication among managers across functional and geographical boundaries enhances coordination of multinational activities in the development of strategic opportunity, which in turn is associated with superior performance.
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“Transaction Cost Economics in Scandinavia,” Scandinavian Journal of Management 21: 5-17.
This Introduction briefly surveys transaction cost economics and explains its general relevance for business administration. A discussion of the impact of transaction cost economics on Scandinavian work in business administration is offered, after which the contributions to the present Special Issue are introduced.