Final answer:
The two conditions for a resource or capability to establish competitive advantage are rarity and imitability. Resources or capabilities that are rare and hard to imitate provide a firm with a competitive edge. Examples include patented inventions and well-respected brand names.
Step-by-step explanation:
Conditions for Establishing Competitive Advantage
The question revolves around conditions for a resource or capability to establish competitive advantage in the context of business strategic management. Competitive advantage is what makes an entity's goods or services superior to all of its competitors. Two of the most crucial conditions for establishing a sustainable competitive advantage are rarity and imitability. A rare resource is one that is not widely available to competitors, and if such a resource is also difficult to imitate, this uniqueness can contribute to the competitive advantage of a firm.
Considering examples such as a patented invention or a well-respected brand name, they fit these conditions because they are both rare and not easily imitable. This creates a competitive edge over other firms that do not possess such resources. In contrast, something like a popular but easily copied restaurant recipe does not provide a competitive advantage because it lacks rarity and is easily imitable.
While efficiency and stability are important for business success, and availability and tradition may contribute to competitive positioning, they don't necessarily create a durable competitive advantage if those attributes are equally shared among competitors or if they can be easily adopted.