Organizational Knowledge and Localized Competition: A Case of a High Performer that is Socially Constructed

• Published in: Seoul Journal of Business Vol. 20; no. 1; pp. 63 - 90
• Main Author: 배종훈
• Format: Journal Article
• Language: English
• Published: Seoul Seoul National University, College of Business Administration 01.06.2014; 경영연구소
• Subjects: Competition; Competitive advantage; Innovations; Knowledge; Normal distribution; Organizational learning; Strategic management; Studies; 경영학
• ISSN: 1226-9816
• DOI: 10.35152/snusjb.2014.20.1.003

This study seeks to elucidate conditions under which high performers emerge independent of their internal resources even when competition in the output market is intense. In particular, the author presents an extended model of localized competition in which 'ill-informed' producers compete with each other by 'observing' the actions of their rivals and 'inferring' the association between the cost and benefit of their action from observable market response to the action of their rivals. To this end, he combines three independent streams of research, including the ecological model of localized competition, organizational knowledge and Harrison White's model of market. An analytical strategy chosen is to parameterize the interplay of organizational knowledge and localized competition so that this study seeks to theorize a general competitive process that underlies the emergence of high performers without ignoring the role of firm heterogeneity in internal resources. In particular, this study characterizes market competition with respect to four parameters, including the size of the neighborhood of a firm, the upper and lower bound of knowledge bases, and a type of the market.