Microfoundations of Resources: A Theory

25 Pages Posted: 2 Apr 2020 Last revised: 21 Apr 2020

See all articles by Teppo Felin

Teppo Felin

University of Oxford - Said Business School

Stuart Kauffman


Todd Zenger

University of Utah

Date Written: February 1, 2020


Where do new resources come from? We build on the premise that environments feature vast reservoirs of latent resources, uses and resource combinations. However, identifying this value can be costly and difficult. In this paper we consider the thought experiment of an endowment-less firm and how it might search for and develop latent resources. We build on perception science and evolutionary biology to highlight how the notion of “searching-for” foreshortens costly search processes. Contrarian beliefs offer a mechanism for generatively seeding search and bootstrapping resources and heterogeneity. Beliefs partially solve the factor markets problem; though their realization is dependent on developing firm-specific theories of value and targeted experimentation. Our approach also addresses how firms might actively harness the adjacent possible. We conclude with a discussion of how our arguments relate to fundamental questions in the field of strategy and the resource-based view.

Keywords: resource-based view, factor markets, entrepreneurship, beliefs, adjacent possible, strategy

JEL Classification: L23, L14, L22, D20, D21, D22, D51, D52, D92, K1, M2, O33

Suggested Citation

Felin, Teppo and Kauffman, Stuart and Zenger, Todd R., Microfoundations of Resources: A Theory (February 1, 2020). Available at SSRN: https://ssrn.com/abstract=3549865 or http://dx.doi.org/10.2139/ssrn.3549865

Teppo Felin (Contact Author)

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

HOME PAGE: http://sites.google.com/site/teppofelin2/

Stuart Kauffman

BiosGroup ( email )

317 Pasco de Peralta
Sante Fe, NM 87501
United States

Todd R. Zenger

University of Utah ( email )

David Eccles School of Business
1655 East Campus Center Drive
Salt Lake City, UT 84112
United States
801 585-3981 (Phone)
801 581-7939 (Fax)

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