The Past Speaks

Readers of this blog may know that I am interested in the emerging Judgement-Based View of Entrepreneurship (JBV) see here. However, I’ve had a hard time assembling a comprehensive list of all of the papers in which researchers apply the JBV to empirical research. In fact, it’s hard to find any. I know that the JBV is a new framework, but I was hoping to find some papers that operationalize it. Can my readers help me to find some?

A bit of background: the JBV framework has been outlined by Nicolai Foss and Peter G. Klein in a series of influential journal articles and a recent book with Cambridge University Press. There was recently a forum in the Journal of Institutional Economics on the JBV, which was also discussed at a session on entrepreneurship theory at the AoM in Vancouver.  In developing the JBV,  Foss and Klein uniteed a number of different intellectual traditions. Their most important debts are to Frank Knight, from whom they took the emphasis on judgement, and the Austrian School of Economics, from which they took hostility to quantitative research approaches and a view of human action that combines methodological individualism and subjectivism. Foss and Klein present the JBV as a challenge to the dominance in entrepreneurship research and entrepreneurship journals of the opportunity-discovery view associated with Shane and Venkataraman (2000). The opportunity-discovery view, which was stated in formal terms in an influential paper by Shane and Venkataraman argues that entrepreneurship research should centre on three investigative questions: why, where, when, and how do entrepreneurial opportunities arise; why is it that certain individuals are better able to discover these opportunities than other individuals; and how do entrepreneurs go about taking advantage of the opportunities they have discovered (Shane & Venkataraman, 2000: 218).

The opportunity-discovery framework now appears to be one of the standard, go-to paradigms for the researchers who publish in entrepreneurship journals.  Shane and Venkataraman (2000) has been cited over 8000. Foss and Klein point out that the opportunity-discovery paradigm has come under attack  from a variety of directions. Foss and Klein suggest that since the opportunity-discovery framework used to study entrepreneurship has been demonstrated to be theoretically unsound, it is a time for a new framework, which they call the JBV.

According to Foss and Klein, the JBV starts with “the need for individuals to make decisions about the future without access to a formal model of decision rule, as would apply to situations of ‘rational’ behavior under probabilistic risk.”  Since entrepreneurs are unable to apply formal models in making judgements about particular ventures, they must use  the intuition, gut feeling, or some other heuristic. At its core, the JBV is a subjectivist theory of entrepreneurial discovery, which holds that the entrepreneur’s subjective “mental model” or vision of the future should be the primary object of study by entrepreneurship scholars (Foss et al, 2008, 80). Proponents of subjectivist research have argued that the study of “entrepreneurs’ subjective perceptions and knowledge may help us to better explain and predict the path that firms will take in the course of decision making under uncertainty” (Kor et al., 2007, 1194).

The JBV, which was developed by Foss, Klein, and Kor, has been further refined by Godley and Casson (2014), who introduce a new term, “the diagnostic entrepreneur.” Diagnostic entrepreneurs serve a function similar to that of a medical doctor or other expert in that they find solutions when consumers are unable to diagnose their own problems or are, in some cases, unaware that they have a problem that requires a solution. Godley and Casson write that the markets for “novel complex and sophisticated products” are often inefficient, since “it is not only difficult to explain to a customer how the novel product may help them, but it is also possible to persuade a customer without a problem that they do in fact need a novel product.” In effect, they argue that diagnostic entrepreneurship is particularly important in sectors of the economy in which rapid technological change has produced widespread uncertainty and ignorance on the part of the consumers.  In such cases, it is up to entrepreneurs to diagnose the problems and create solutions.

I’ve read the theoretical papers by Foss, Klein, Godley, and Casson with great interest. However,  I would be really interested in seeing how people have gone about applying the JBV in empirical research. In particular, I’m curious to know about research methodology and the types of data sources people have used to apply/test/refine the JBV.

Please post your suggestions for future reading below. Many thanks in advance.