ENTREPRENEURSHIP AS A SCIENTIFIC RESEARCH PROGRAMME. José Maria Veciana Universitat Autònoma de Barcelona
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1 ENTREPRENEURSHIP AS A SCIENTIFIC RESEARCH PROGRAMME José Maria Veciana Universitat Autònoma de Barcelona
2 ABSTRACT: In this article entrepreneurship as a scientific research programme is developed and presented. In this relatively new field of study many different theories have emerged that try to explain the phenomenon of new enterprise or venture creation. After a brief treatment of the antecedents and historic of the author discusses and suggests what should be development entrepreneurship, the distinctive domain of entrepreneurship research. He then develops and presents the different paradigms or theoretical approaches that have emerged in this field. An attempt is made to classify the diverse theories based on the various theoretical approaches to the study of entrepreneurship. The aim of this paper is not only to delimit this broad field of study but also to offer a guide for future empirical research and theoretical developments.
3 SUMMARY Objective Develop entrepreneurship as a scientific research programme Overview Overview of origins and evolution, antecedents and historic development. 4 stages: defining entrepreneur, historical studies, beginning of the scientific research in Business Administration, consolidation and explosion. Development Four theoretical approaches that have emerged in the field of entrepreneurship, trying to explain entrepreneurship from very different perspectives.
4 4 STAGES 1st stage: who an entrepreneur is, what he does and what the entrepreneurial function is ( ). 2nd stage: Historical studies (1920 s). 3rd stage: The Beginning of the Scientific Research Programme in the Field of Business Administration ( ); Small and Medium-Sized Enterprises (SMEs), Entrepreneur and New Venture Creation. 4th stage: Consiolidation and Explosion ( ).
5 THEORETICAL APPROACHES TO THE STUDY OF ENTREPRENEURSHIP ECONOMIC APPROACH SOCIOCULTURAL APPROACH PSYCHOLOGICAL APPROACH MICRO (Individual level) MESO (Corporate level) Entrepreneurial function as fourth factor of Margination theory production Traits theory Role theory Theory of the Psychodynamic theory Network theory entrepreneurial profit Theory of occupational choice under uncentainty Transaction cost theory X Schumpeter s theory of MACRO economic development Theory of the (Globalendogenous regional country level) development Leibenstein x-efficiency theory Behavioral theory of the entrepreneur modes of new enterprise creation modes to become an entrepreneur Modes of new Network theory enterprise success Incubators theory and failure Evolutionary Corporate theory MANAGERIAL APPROACH entrepreneurship Kirzner s entrepreneur theory Weber s theory of economic development Theory of social change Population ecology theory Institutional theory X
6 ECONOMIC APPROACH Micro Level Meso Level To be entrepreneur requires the combination of moral qualities that are not frequently found together. Entrepreneur s profit Include: a) risk premium b) the entrepreneur s wage c) the entrepreneur s rent which is derived from the scarcity of persons with entrepreneurial capacity. The less risk averse individuals become entrepreneurs, while the more risk averse work as laborers. Macro Level Entrepreneur is any person that carves out new combinations of the factors of production. the transaction costs determine both at an individual and corporate level to create of a new, own firm or to sell of the new entrepreneurial idea or project. The opportunities of new combinations of factors of production result mainly from the technological change. Each new investments produces a dissemination effect outside the company making the investment (the spillover effect).
7 PSYCHOLOGICAL APPROACH Micro Level Macro Level Traits theory Psychological traits that distinguish entrepreneurs from non-entrepreneurs and the successful entrepreneurs from the less successful ones. Need of independence Need of achievement Internal locus on control Risk taking propensity Unsatisfied or marginated persons Intuition Tolerance of ambiguity Psychodinamic Theory of entrepreneurial personality: emphasizes the unconscious determinants of personality. People are driven by irrational forces. Kirzner's Entrepreneur theory For Kirzner an entrepreneur is a person who is alert to business opportunities that have not been identified by others. The central concept is alertness to information (rather than possession). Kirzner, like Schumpeter, believes that the market is in disequilibrium so there are market opportunities. With his behavior the entrepreneur pushes the market towards equilibrium.
8 SOCIO-CULTURAL APPROACH Decision to become an independent entrepreneur is conditioned by external or environmental factors. Micro Level Meso Level Margination theory new firm formation rate is higher in the immigrant population (negative factor). Role theory why in industrial regions with an entrepreneurial culture new firms are created and why it is so difficult to foster entrepreneurship in regions with a lack of these conditions. (i.e. Silicon Valley and Catalunya) Network theory entrepreneurial function exists and develops in a network of social relations. Network theory strategic alliances are considered to be an intermediate or hybrid form of governance structure. Incubator's theory spin-offs: firms that have been incubated in other organizations. Evolutionary theory closely related to the incubator theory, it could explain why some organizations have generated certain innovation routines. Macro Level Weber's theory of economic development the behavior of the capitalistentrepreneur is strongly conditioned by religious beliefs (Max Weber) Theory of social change factors of the entrepreneurial spirit (degree of mobility, both social and geographical, nature of mobility channels) Population ecology theory the environment determines the birth, growth and death of new enterprises. Institutional Theory "Institutions are the rules of the game in a society or humanly devised constraints shape human interaction" (North)
9 MANAGERIAL APPROACH The theories included under this approach are based on the assumption that the act of new enterprise formation is the result of a rational decision. Micro Level The entrepreneur is able to establish guidelines that can guide potential entrepreneurs in the process of new enterprise creation. Meso Level Under the managerial approach it is hypothesized that there are other factors that determine the success and failure of new enterprises and that these variables are under entrepreneur s control. Corporate entrepreneurship can be described as the activity in a corporation that aims at identifying new opportunities beyond the core business New enterprise creation is equivalent to the creation of a new system and therefore the knowledge supplied by the organization theory should be taken into account. There are many ways to become an entrepreneur (i.e. franchise, purchasing a company, inheritance...)
10 CONCLUSION 1/2 An analysis of big corporates should be developed using the previously described pattern. It's difficult to reach exhaustive results for what concerns generating useful knowledge for creating new enterprises. The first three approaches (economic, psychological and sociocultural) try to explain why new firms are created while the managerial approach is a useful guideline for generating knowledge, which is useful for future enterprises. This study concerns a still too much variable context due to the fact that many factors of uncertainty could easily affect it.
11 CONCLUSION 2/2 This new scientific research programme has been formed during the last fifty years but it's consolidation has occurred in the last three decades. Even though a sufficient conceptual and research work has been done so far to attempt to tackle this critical matter, there will be definitely much work and research to do from now on in order to face the many uncertainties that nowadays represent the current situation. In order to become an entrepreneur and open your very own business, a substantial investment will be required, and many new entrepreneurs have difficulty obtaining funds on their own. Now that we are beginning to overcome the financial/economic downturn, high risk investment may be even more difficult to find.
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