This paper develops a realistic real option theory of resource allocation decisions in strategic factor markets. Competitive advantage in factor markets is underpinned by market failures that allow firms to acquire assets at less than their value in use. We recognize that market failure may...

Entrants are often viewed as suffering from a “liability of newness” — at founding they rarely possess the knowledge and capabilities necessary to compete and survive. They can overcome this liability by learning vicariously from the knowledge of incumbent firms. But how can entrants learn...

Strategic imitation occurs when a firm purposefully attempts to reproduce, in whole or part, other firms’ products, processes, capabilities, technologies, structures, and/or decisions in its pursuit of competitive advantage. Imitation is a pervasive firm behavior, and the literature relating...