Cracking the Black Box : Connecting External and Internal Determinants of Firm Performance at the Point of Transaction.

Summary The dissertation integrates external and internal analyses into competitive strategy in order to contribute to the analysis of the microfoundations of competition. The rationale for the thesis is motivated by two hiatuses identified in the literature that constitute a unique gap in the literature. First, the field has tended to seek advantage in either resource or positioning with little integration of the two dimensions. Second, the field has neglected how the heterogeneous resource and positioning form an endogenous microenvironment and interact during transactions. The thesis approach adopts a game-theoretic approach that harmonizes (a) firm heterogeneity and thus echoes the internal analysis, (b) strategic interaction between firms that captures the external analysis, and (c) the endogenous microenvironment. Under this general theme, the thesis focuses on three scenarios, in three distinct chapters, which share four common connections beyond the concerted effort to decipher the black box: (i) All three chapters are deeply rooted in transactions, (ii) Cumulative patterns and processes that influence firms' competitive advantage are analyzed, (iii) The set of concepts are located at the firm level, (iv) External and internal determinants are considered simultaneously. Concretely, Chapter 1 introduces the ex ante cost perspective that explains the ex post cost and ex ante incentive analyses. Chapter 2 presents the theoretical framework of evolutionary advantage through the lens of contracting strategy. Chapter 3 shows that the difference in firms' bargaining behavior supports an additional dimension of strategic maneuverability that ultimately affects value appropriation. Overall, the thesis contributes to the understanding of the dynamics of transactions between firms. It offers a valuable precedent in the integration of external and internal analyses, while at the same time providing a complement to the analysis of microfoundations.