Markets, firms, and the process of economic development

We develop a framework to describe value creation as a process comprising r esource combinations and exchanges and use the framework to show how organi zations in general, and business firms in particular, interact with markets to create economic value for themselves, for their members, and for societ y. The theory offers an explanation of why neither a market nor a firm, by itself, can achieve adaptive efficiency and why institutional pluralism con tributes to the process of economic development.