Corporate Strategies and Performances of Korean Firms: The Unified Theory of the Firm Perspective

A good understanding of the nature of the firm is essential in developing corporate strategies, building corporate competitiveness, and establishing sound economic policy. Several theories have emerged on the nature of the firm: the neo-classical theory of the firm, the principal agency theory, the transaction cost theory, the property rights theory, the resource-based theory and the evolutionary theory. Each of these theories identify some elements that describe the nature of the firm, but no single theory is comprehensive enough to include all elements of the nature of the firm. Economists began to seek a theory capable of describing the nature of the firm within a single, all-encompassing, coherent framework. We propose a unified theory of the firm, which encompasses all elements of the firm. We then evaluate performances of Korean firms from the unified theory of the firm perspective. Empirical evidences are promising in support of the integrative theory of the firm.