The Boundary of the Firm

Martin Slater

in The Oxford Handbook of Strategy

Published in print April 2006 | ISBN: 9780199275212
Published online September 2009 | | DOI:

Series: Oxford Handbooks in Business and Management C

 The Boundary of the Firm

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  • Business and Management
  • Business Strategy
  • Organizational Theory and Behaviour


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This article has various aims: to demonstrate that the central concept of a ‘firm’ is more complicated than might immediately appear; to examine various explanations that have been put forward for why firms exist at all; to examine the factors which constrain the size and range of activities of firms; to compare the nature of relationships within firms with relationships between firms; and to consider how ownership of assets affects incentives. Any discussion of business strategy inevitably presupposes the existence of a business firm, for which the strategy is intended. Furthermore, the outcome of the strategic discussion will be aimed at changing the nature of the firm in various ways: the products it produces, the ways in which it produces and sells them, and the activities performed by the firm and those performed outside the firm.

Keywords: firm activities; assets ownership; incentives; business strategy; firm's existence; business firm

Article.  10738 words. 

Subjects: Business and Management ; Business Strategy ; Organizational Theory and Behaviour

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