Capabilities and value vs uncertainty and transaction costs in explaining the process of firm growth

The article proposes a theoretical framework of firm growth process based on the integration of the resource-based view and transaction cost theory. The framework contributes to the early streams of research 1) in the growth process of the firm, rooted in entrepreneurship literaturę and 2) in the integration of the RBV and TCT perspectives to explain the firm boundary (scope and size) decisions, rooted in strategic management literature. The paper methodology is based on confronting and then integrating these two perspectives to explain firm growth process. Beside conceptual literature review, systematic review of empirical research that links the RBV and TCT to explain firm boundaries was implemented. The results show that entrepreneurial growth decisions are determined by the assessment of firm capabilities and prospective value from growth relative to environmental uncertainty and transaction costs of company expansion