The effects of implicit firm theory on customer engagement and firm-related judgments

Purpose This paper aims to introduce the implicit firm theory, distinguishing between the belief that firms can (incremental firm theory) or cannot (entity firm theory) readily change in response to marketplace demands. It is proposed and shown, that firm theory beliefs influence customer-engagement attitudes and intentions. Design/methodology/approach Study 1 tests the relationship between firm theory, self-theory and knowledge-sharing attitudes. Study 2a tests differences between incremental and entity firm theorists in response to firm failure. Study 2b examines the relationship between firm theory and blame attributions on post-failure loyalty. Study 3 explores the effect of firm theory on perceptions of control and blame attributions following repeated firm failures. Findings Study 1 shows firm theory influences consumer knowledge-sharing attitudes beyond the effect of self-theory. Study 2a shows incremental firm theorists are more likely to remain loyal to a firm following failure and less likely to share negative word-of-mouth. Study 2b shows that blame attributions mediate the relationship between firm theory and loyalty intentions, with incremental theorists ascribing less blame. Study 3 shows incremental firm theorists significantly increase blame following multiple failures, while entity firm theorists do not. Research limitations/implications Results are based on scenario-based surveys and experimental methods; their applicability in more complex real-world customer-firm relationships warrants additional study. Practical implications Firms should account for a customer’s firm theory in their communications, emphasizing situational factors to reduce post-failure blame among incremental firm theorists. Originality/value Establishes that consumers hold beliefs regarding the malleability of firm traits, which influence their firm engagement intentions.

Market structure and knowledge acquisition by firms

PurposeRecent models in firm theory assume that problems have to be solved for production to take place and that knowledge is the main input for problem-solving. This paper characterizes the relationship between the predictability of production prcesses and investment in knowledge.Design/methodology/approachThis paper uses a theoretical model of firm theory to study investment in knowledge by a simplified one-layer firm with a stochastic technology, across different market structures, and develops a calibration exercise to illustrate the results.FindingsFirms working closer to the production frontier (those with a larger efficient scale in perfect competition, facing a higher demand in monopoly or more competitive internationally in an open economy) react more in terms of investment in knowledge when problem predictability changes. Investment in knowledge becomes nearly insensitive to such changes for firms with a low output, i.e. those far from the frontier. A calibration exercise suggests that the elasticity of knowledge with respect to the predictability of problems was around 0.59 for the US economy for the period 1980–2020.Originality/valueThese are the first nonambiguous results on the relationship between the predictability of production processes and investment in knowledge and help understanding knowledge acquisition by different firms in distinct competitive environments.

Um modelo de firma pós-keynesiana

<p>This paper aims at theoretically modelling the Post Keynesian firm. What we notice in the Post Keynesian literature is that there are several elements concerning the firm theory, however they are sparse; thereby, there is not a consolidated and summarized form of firm, in which all these relevant elements are combined to synthesize the Post Keynesian firm. But, if the Post Keynesian theory has not got a portrait of the its firm, what could mirror its constitution? To do so, this paper recalls to a firm that is already consolidated in the economic theory and that is not divergent to the Post Keynesians, the one furnished by the Resource Based View. Departing from an already available firm theory, the Resource Based View approach of the firm guides what must be looked at in order to design the synthesis of the Post Keynesian firm. </p>