Resource-Based Theory and the Value Creation Framework

This article explains how viewing resource-based theory within Brandenburger and Stuart's value creation framework adds clarity to the theory as a whole and to its essential elements including the definition of its dependent variables, its approach to value creation, and its approach to the appropriation of economic value. Building on this foundation, the article addresses several questions about resource-based theory: Is it a theory or a view? Is resource-based theory tautological? Is resource-based theory static? How important are stakeholders within resource-based theory? Does resource-based theory constitute a theory of the firm? Does resource-based theory acknowledge industry structure's role in explaining firm performance? Does resource-based theory incorporate uncertainty? Does resource-based theory have strong managerial implications? In accomplishing these tasks, the article sets the stage for the further evolution and application of resource-based theory.