AN EMPIRICAL TEST OF THE RESOURCE-BASED THEORY: STRATEGIC REGULATION IN THE DUTCH AUDIT INDUSTRY

The resource-based view of the firm is a recent strategic management theory that seeks to identify the resources that may provide firms with a sustainable competitive advantage. This paper has two purposes. First, the paper relates strategic management arguments to parallel lines of reasoning in industrial organization theory and argues that strategic regulation is a major source of sustainable competitive advantage. The second purpose of the paper is to report the results of an empirical test of the resource-based theory on the basis of a longitudinal data set on the postwar history of the Dutch audit industry. A key determinant of this history proves to be strategic regulation, which stimulates demand for audit services and protects rent-producing resources.     

Structural Changes in Australian Manufacturing Industry*

The paper uses a neoclassical production function and historical data to test for structural stability in Australian manufacturing industry. The production function is an extended constant elasticity of substitution form in which factor substitution elasticity, returns to scale and market structure in output, capital and labour are testable hypotheses. Tests for structural changes in homogeneity and factor substitution elasticity relations are based on overall and individual tests of covariance analysis and also on a special version of the Swerling-Kalman filtering systems as proposed by Cooley and Prescott. The empirical findings possess desirable statistical properties and indicate the existence of structural instability in the industry. The evidence also repudiates the assumptions of unitary factor substitution elasticity, constant returns to scale and market competitiveness in output and factors of production.     

RETROSPECTIVE ON OIL PRICES

Energy is the most abundant resource in the universe. While energy supplies are unbounded, useful energy is not. To convert naturally occurring energy resources into useful work, mankind must invest capital and labor–resources that normally are scarce. To produce or use primary energy, both producers and consumers must invest in specialized and often inflexible equipment. In calculating the perceived value of present and future oil supplies, the Organization of Petroleum Exporting Countries and almost everyone else mistook for economic rent the windfall profits associated with short-term rigidities in energy use. Attention focused on the cost of manufacturing a synthetic crude oil, rather than on the incremental cost of changing consumption patterns in end-use markets. Mis judgments on the future value of oil were compounded by ill-conceived government policies and inaccurate forecasts. Substitution of oil for other energy commodities can occur at nearly every point along the chain downstream from the production of primary resources, but it occurs most abundantly and importantly at the point of final consumption. Liquid petroleum remains the cheapest fuel to transport, chiefly because a vast infrastructure already exists to handle it. The steady advance of technology explains the long-term decline in the real prices of most products, including retail energy prices. Often, the increasing unit costs of harvesting or extracting a finite scarce natural resource have been more than offset by improvements in manufacturing or end-use technology. The mix of commodities bought and sold in the next generation may be unrecognizable to today's consumer. Thus, the cost of any one primary resource or intermediate product may be irrelevant.     

Multi‐level Environmentalism and the European Union: The Case of Trans‐European Transport Networks

In the European Union, trans‐European transport networks (TENs) are a vital element in the constitution of one European space in order to enable the free movement of people and goods throughout the Union. Their construction, however, often causes environmental degradation. Opposition to EU politics is mostly voiced at the level of individual nation‐states. As the case of TENs reveals, however, protest against European policy projects with environmental side effects can take the form of ‘multi‐level environmentalism’, linking lobbying and ‘conscientization’ in Brussels with direct action at the national and local levels. Civil society theory, social movement theory and governance theory help ensure a theoretically informed answer to the question of how the resistance to TENs is organized and framed. By questioning dominant problem definitions and solution strategies, environmental movements and movement organizations, both in Brussels and in the individual nation‐states, point to the possibility of looking at social and political reality from another, non‐hegemonic point of view. In this way, they contribute to challenging the often biased technocratic, growth‐oriented character of the European Union.