Revised and updated to reflect the cutting edge of academic thinking about business strategy, the Fourth Edition of Besanko, Dranove, Shanley, and Schaefer’s highly acclaimed text offers a solid economic foundation for strategic analysis. By presenting basic concepts of economic theory with ideas in modern strategy literature, the book provides an economic lens for viewing the broad sweep of the strategic activities of the firm.

The book begins by focusing on the boundaries of the firm and examines competitive strategy from the perspective of industrial organization (IO) economics, particularly Porter’s Five Forces. It then explores strategic positioning and dynamics as well as topics associated with internal organization, including personnel economics, organization structure, and strategic fit.

Features of the Fourth Edition

• Chapters on human resources management, entry, positioning, dynamics, technological change, and organizational structure are substantially revised.
• An updated chapter on business history covers the recent dot-com bubble.
• Presents economic principles without overemphasizing the math.
• Rigorous treatment of organizational topics such as structure and culture enables you to experience the full scope of strategic thinking.
• The authors use Porter’s Five Forces as a tool for organizing industry analysis, building on the coverage of industrial organization and game theory. The text also considers the Value Net, another tool for organizing industry analysis.
• Includes coverage of make or buy decisions (Chapters 2-4) and benefit and cost advantage and sustaining advantage (Chapters 11-13).
• Fascinating examples, including many new to this edition, bring the economic models to life. Many of the examples involve businesses outside of the United States.

Revised and updated to reflect the cutting edge of academic thinking about business strategy, the Fourth Edition of Besanko, Dranove, Shanley, and Schaefer's highly acclaimed text offers a solid economic foundation for strategic analysis. By presenting basic concepts of economic theory with ideas in modern strategy literature, the book provides an economic lens for viewing the broad sweep of the strategic activities of the firm.

The book begins by focusing on the boundaries of the firm and examines competitive strategy from the perspective of industrial organization (IO) economics, particularly Porter's Five Forces. It then explores strategic positioning and dynamics as well as topics associated with internal organization, including personnel economics, organization structure, and strategic fit.

Features of the Fourth Edition

* Chapters on human resources management, entry, positioning, dynamics, technological change, and organizational structure are substantially revised.

* An updated chapter on business history covers the recent dot-com bubble.

* Presents economic principles without overemphasizing the math.

* Rigorous treatment of organizational topics such as structure and culture enables you to experience the full scope of strategic thinking.

* The authors use Porter's Five Forces as a tool for organizing industry analysis, building on the coverage of industrial organization and game theory. The text also considers the Value Net, another tool for organizing industry analysis.

* Includes coverage of make or buy decisions (Chapters 2-4) and benefit and cost advantage and sustaining advantage (Chapters11-13).

* Fascinating examples, including many new to this edition, bring the economic models to life. Many of the examples involve businesses outside of the United States.

Part One. Economic Foundations of Strategy.

Chapter 1. Basic Microeconomic Principles.

Chapter 2. Economies of Scale and Scope.

Chapter 3. Agency and Coordination.

Chapter 4. The Power of Principles – An Historical Perspective.

Part Two. Firm Boundaries.

Chapter 5. The Vertical Boundaries of the Firm.

Chapter 6. Organizing Vertical Boundaries: Vertical Integration and Its Alternatives.

Chapter 7. Diversification.

Part Three. Market and Competitive Analysis.

Chapter 8. Competitors and Competition.

Chapter 9. Strategic Commitment.

Chapter 10. The Dynamics of Pricing Rivalry.

Chapter 11. Entry and Exit.

Chapter 12. Industry Analysis.

Part Four. Strategic Position and Dynamics.

Chapter 13. Strategic Positioning for Competitive Advantage.

Chapter 14. Sustaining Competitive Advantage.

Chapter 15. The Origins of Competitive Advantage: Innovation, Evolution, and Environment.

Part Five. Internal Organization.

Chapter 16. Performance Measurement and Incentives in Firms.

Chapter 17. Strategy and Structure.

Chapter 18. Environment, Power, and Culture.\n

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