Deeper analyses of this topic were taken up in industrial organization economics by crossover economics/strategic-management scholars such as Harold Demsetz[1][2] and Michael Porter.
In addition to economics-based explanations noted above, Hoopes et al. point out that differing beliefs, preferences, and objectives lead firms pursuing similar customers to find and develop unique competitive positions.
Additionally, Hoopes, et al. suggest that competitive advantage should be thought of in terms of each firm's economic contribution.
"Value is the price a buyer is willing to pay for a good absent competing products or services yet within budget constraints and considering other purchasing opportunities.
[17] Under this theory, competitive advantage is deemed to be possessed by the firm who implements largest difference between value and cost when compared to rivals.
This bargaining model has been further developed extensively in Johnson's account of economic opportunity rents[18] underpinning heterogeneous competition.
In summary, a theory of competitive heterogeneity seeks to explain why firms do not converge on a single best way of doing things as predicted by simple microeconomics.