Penrose'sThe Theory of the Growth of the Firm:An Exemplar of Engaged Scholarship

What is it about?

Penrose's work is considered foundational in the areas of strategy and entrepreneurship. The paper provides an overview of Penrose's main ideas, and puts them in the context of modern developments in the areas of strategy and operations management. The paper also proposes a simple model that summarizes Penrose's ideas about growth, and derives the 'Penrose Effect', the notion that fast growth in one period leads to slower growth in the next period.

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