There is an ongoing debate as to whether the strategies of differentiation and cost leadership are mutually exclusive or whether they can be achieved simultaneously. Using transaction cost theory, a model of business-level strategy is developed that reconciles these divergent perspectives. It is argued that when transaction costs, production costs, and revenue are considered within the calculus of a single model, the trade-offs a firm faces when choosing a business strategy become clearer.
Stored only when both papers are in the corpus — 129 citations exist upstream.