An Empirical Test of Systematic Process Differences between the Bursting of Innovative Venture Initiatives and the Shaping Forces of Imitative Venture Initiatives

Abstract

How general can a “general” theory of entrepreneurship be? Abstraction is a necessity but is it possible to include venture opportunity variation in a general theory of entrepreneurship building on two contrasting perspectives such as equilibrium economics and disequilibrium economics. Two important boundaries need to be explicated. First, defining entrepreneurship as the creation of new economic activity includes both the creation of new means – ends (cf. Schumpeter, 1934) – as well as optimizing within known means – ends frameworks (cf. Kirzner, 1997). Second, such a theory includes an opportunity – actor nexus because it is the first tangible or intangible evidence of existing venture opportunities. Formal models of entrepreneurship often start with a person and at some point in time an exchange of persons with firms take place which is confusing because both levels of analysis and outcome are mixed with each other. Apparently, there is no such thing as entrepreneurship without actors, but if we want to create knowledge about the creation of economic activity, we need to frame our boundary around the nascent initiative instead of single actors and/or teams of actors because value can only be assessed in relation to the costs of services withdrawn. Analogous to this is, for example, the theory of firm and the theory of organizations with boundaries well beyond single actors or groups of actors. Another factor behind a venture-based theory of entrepreneurship comes from empirical evidence from the Swedish PSED, which suggests that approximately 16% (n=97) nascent entrepreneurs are exchanged during the start-up process. Formal models of entrepreneurship could therefore start with the nexus of venture opportunities and enterprising actors as suggested by Shane (2003) or with resources as suggested by Davidsson (2000) and progress forward in the entrepreneurial process. Entrepreneurship models built around the economic activity itself needs to be dynamic allowing different outcomes and feedback loops because resource combinations alter our perception of value and diffuses information, which may lead to additional resource combinations (Hayek, 1945).

Citation

Samuelsson, M. (2006), "An Empirical Test of Systematic Process Differences between the Bursting of Innovative Venture Initiatives and the Shaping Forces of Imitative Venture Initiatives", Wiklund, J., Dimov, D., Katz, J.A. and Shepherd, D.A. (Ed.) Entrepreneurship: Frameworks And Empirical Investigations From Forthcoming Leaders Of European Research (Advances in Entrepreneurship, Firm Emergence and Growth, Vol. 9), Emerald Group Publishing Limited, Leeds, pp. 53-106. https://doi.org/10.1016/S1074-7540(06)09004-0