Captains of their Own Destiny? Toward a Theory of Entrepreneurial Agency in Firm Survival

Abstract

Despite the growing importance of young, entrepreneurial ventures in modern economic systems, many such ventures fail quite early in their lifecycles. While both evolutionary theory and organizational learning theory yield important insights for the literature on young venture survival, questions remain as to why ventures facing similar environments experience differential rates of survival. In response, I propose a theory of entrepreneurial agency – defined as the emergence and/or transformation of firms, markets, industries governed by the evolving interaction of temporally situated, intentional strategic action with a malleable external environment – to complement prevailing viewpoints on the causes of young venture survival. My central thesis in this chapter is that to develop more comprehensive explanations of differential survival rates, a theory of entrepreneurial agency – illuminating the transformative potential of entrepreneurial action – is necessary to complement evolutionary perspectives in the literature on firm survival. With this objective in mind, I construct a theoretical model linking diverse perspectives on the duality of human agency and theories of environmental selection, and offer several theoretical and empirical suggestions to guide future research.

Citation

Townsend, D.M. (2012), "Captains of their Own Destiny? Toward a Theory of Entrepreneurial Agency in Firm Survival", Corbett, A.C. and Katz, J.A. (Ed.) Entrepreneurial Action (Advances in Entrepreneurship, Firm Emergence and Growth, Vol. 14), Emerald Group Publishing Limited, Leeds, pp. 125-160. https://doi.org/10.1108/S1074-7540(2012)0000014008