Microfoundations of Ecosystems: The Theory-Led Firm and Capability Growth

Abstract

Our argument is that firm-specific theories are critical for ecosystems. We first highlight how existing research on ecosystems lacks microfoundations and tends to be overly structural. We focus on the theory-led firm—the role that a firm-specific theory plays in capability development and the growth of ecosystems. Ecosystems are contingent on firm-specific theories of value. We also discuss the implications of our arguments for search- and demand-based approaches to ecosystems and point toward a theory-based and supply-side alternative.

Keywords: ecosystems, microfoundations, capabilities, organizational economics, strategy, governance

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