Causal ambiguity allows a firm's competitive advantage to be sustained because potential rivals are:
A)Deterred from directly competing with the advantaged firm
B)Unable to identify the sources of the advantaged firm's superior performance
C)Unable to acquire the resources needed to compete against the advantaged firm
D)All the above

Question

Quizplus · Accepted Answer

Causal ambiguity refers to the difficulty of determining the exact reasons for a firm's competitive advantage. If potential rivals are unable to identify the sources of the advantaged firm's superior performance, they are less likely to be able to replicate it and compete directly with the firm, thus allowing the firm's competitive advantage to be sustained. While factors such as deterrence and resource acquisition may also contribute to the sustainability of a firm's advantage, it is the inability to identify the sources of superior performance that is specifically related to causal ambiguity.

Causal Ambiguity Allows a Firm's Competitive Advantage to Be Sustained