Question

If a firm's resources and capabilities are costly to imitate because imitating firms may not understand the relationship between the resources and capabilities controlled by a firm and that firm's competitive advantage, this competitive advantage is said to be protected from imitation by

A) path dependence.
B) causal ambiguity.
C) unique historical conditions.
D) social complexity.

Answer 1

A competitive advantage that is protected from imitation by causal ambiguity refers to the inability of competitors to understand and replicate the specific cause-and-effect relationships that lead to the firm's competitive advantage.

Step-by-step explanation:

A competitive advantage that is protected from imitation because imitating firms may not understand the relationship between the resources and capabilities controlled by a firm is said to be protected by causal ambiguity. Causal ambiguity refers to the inability of competitors to understand and replicate the specific cause-and-effect relationships that lead to a firm's competitive advantage. This lack of understanding makes it difficult for competitors to imitate the resources and capabilities of the firm, giving the firm a sustained competitive advantage.