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Journal ArticleDOI

Entrepreneurship and growth

01 Feb 2013-International Small Business Journal (SAGE Publications)-Vol. 31, Iss: 1, pp 3-22
TL;DR: The authors of as discussed by the authors suggest that there is a greater need to understand the processes that underlie entrepreneurial growth and how the entrepreneur's cognitive processes shape growth, how they access and configure resources to achieve growth, and whether these are influenced by a wider variety of contextual dimensions than previously recognised.
Abstract: The entrepreneurial growth literature is extensive, but research focusing on questions such as how firms grow, why they grow according to different patterns, how the decisions about growing or not growing are made, and the contextual dimensions within which growth takes place, has been neglected. This annual review article explores such issues: it suggests that there is a greater need to understand the processes that underlie entrepreneurial growth. In particular, we need to know more about how the entrepreneur’s cognitive processes shape growth (i.e. microfoundations of growth), how they access and configure resources to achieve growth (i.e. the resource orchestration underpinning growth), whether these are influenced by a wider variety of contextual dimensions than previously recognised, and how these influence different patterns and types of growth.
Citations
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Journal ArticleDOI
TL;DR: In this article, the authors focus on regional entrepreneurial ecosystems and offer a complex model of start-ups, Regional Entrepreneurship and Development Index (REDI) and six domains of the entrepreneurial ecosystem (culture, formal institutions, infrastructure and amenities, IT, Melting Pot and demand).
Abstract: This study focuses on regional entrepreneurial ecosystems and offers a complex model of start-ups, Regional Entrepreneurship and Development Index (REDI) and six domains of the entrepreneurial ecosystem (culture, formal institutions, infrastructure and amenities, IT, Melting Pot and demand). Altogether they capture the contextual features of socioeconomic, institutional and information environment in cities. To explain variations in entrepreneurship in a cross-section of 70 European cities, we utilize exploratory factor analysis and structural equation modelling for regional systems of entrepreneurship using individual perception surveys by Eurostat and the REDI. This study supports policymakers and scholars in development of new policies conducive to regional systems of innovation and entrepreneurship and serves as a basis for future research on urban entrepreneurial ecosystems.

480 citations

Journal ArticleDOI
TL;DR: In this article, the authors develop five pillars on which the evolving social role of entrepreneurship can rest and have its impact: connecting entrepreneurial activities to other societal efforts aimed at improving the quality of life, achieving progress, and enriching human existence, identifying ways to reduce the dysfunctional effects of entrepreneurial activities on stakeholders, redefining the scope of entrepreneurship activities as a scholarly arena, recognizing entrepreneurship's social multiplier, and pursuing blended value at the organizational level, centring on balancing the creation of financial, social and environmental wealth.
Abstract: There is a need to rethink and redefine the social value added of entrepreneurial activities to society. In this paper we develop five pillars on which the evolving social role of entrepreneurship can rest and have its impact: (1) connecting entrepreneurial activities to other societal efforts aimed at improving the quality of life, achieving progress, and enriching human existence, (2) identifying ways to reduce the dysfunctional effects of entrepreneurial activities on stakeholders, (3) redefining the scope of entrepreneurial activities as a scholarly arena, (4) recognizing entrepreneurship's social multiplier, and (5) pursuing blended value at the organizational level, centring on balancing the creation of financial, social and environmental wealth. In a final section we discuss implications for practices and for further research.

257 citations

Journal ArticleDOI
TL;DR: In this paper, the authors explore what we do and do not know about entrepreneurial finance and its relationship with growth, and propose that the relationship between funding gaps and business performance as a direct and nuanced approach to identifying financial constraints in different entrepreneurial finance markets requires scrutiny.
Abstract: This article explores what we do (and do not) know about entrepreneurial finance and its relationship with growth. Broadly, there is a need for research to go beyond traditional supply side/market failure issues to better understand the role of entrepreneurial cognition, objectives, ownership types and firm life-cycle stages in financing/investment decisions. We show that little is known about the pivotal relationship between access to external finance and growth due to limitations in current approaches to testing financial constraints. Instead, we propose that the relationship between funding gaps and business performance as a direct and nuanced approach to identifying financial constraints in different entrepreneurial finance markets requires scrutiny. There is also a necessity for research to disentangle cognitive from financial constraints and to better understand the role of financiers in enabling growth. In particular, there is a need to explore the relationship between non-bank sources of finance and growth, shorn of inherent survival and selection bias. We outline an agenda for future research to address gaps in our understanding.

219 citations

Journal ArticleDOI
TL;DR: In this paper, the authors review and synthesize extant research on entrepreneurial leadership, capabilities and their influence on the growth of small and medium-sized enterprises (SMEs) and explore the interrelationships between substantial capabilities, leadership and dynamic capabilities.
Abstract: In this article, we review and synthesize extant research on entrepreneurial leadership, capabilities and their influence on the growth of small- and medium-sized enterprises (SMEs). First, we begin by examining the processes, routines and resources underlying substantive growth capabilities; these are capabilities that enable a firm to grow by competing in its market(s) on a day-to-day basis. Second, we explore leadership in terms of the cognitions motivations and decisions to invest in growth. Third, we examine the dynamic capabilities, which extend, modify or create new substantive (growth) capabilities, to support the sustained pursuit of new opportunities. In so doing, we explore the interrelationships between substantial capabilities, leadership and dynamic capabilities. We conclude the review by highlighting areas of consensus and contention in the literature, from which we propose fruitful areas for future research.

204 citations

Journal ArticleDOI
TL;DR: In this article, the authors used UK data to consider how small and medium-sized enterprises (SMEs) coped during the recent financial crisis and found that 4 in 10 SMEs experienced a fall in employment during the recession, and 5 in 10 experienced a falling in sales.
Abstract: This article uses UK data to consider how small and medium-sized enterprises (SMEs)1 coped during the recent financial crisis. This is important, as SMEs are major contributors to job creation, but are vulnerable to falling demand. It finds that 4 in 10 SMEs experienced a fall in employment during the recession, and 5 in 10 experienced a fall in sales. Within 12 months of the recession, three-quarters of entrepreneurs had a desire to grow. This suggests that while the immediate effects of recession are severe, entrepreneurs recover quite quickly. Importantly, the analysis found that recessionary growth is hugely concentrated among entrepreneurs with the highest human capital.

176 citations

References
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Journal ArticleDOI
TL;DR: An integrative theoretical framework to explain and to predict psychological changes achieved by different modes of treatment is presented and findings are reported from microanalyses of enactive, vicarious, and emotive mode of treatment that support the hypothesized relationship between perceived self-efficacy and behavioral changes.
Abstract: The present article presents an integrative theoretical framework to explain and to predict psychological changes achieved by different modes of treatment. This theory states that psychological procedures, whatever their form, alter the level and strength of self-efficacy. It is hypothesized that expectations of personal efficacy determine whether coping behavior will be initiated, how much effort will be expended, and how long it will be sustained in the face of obstacles and aversive experiences. Persistence in activities that are subjectively threatening but in fact relatively safe produces, through experiences of mastery, further enhancement of self-efficacy and corresponding reductions in defensive behavior. In the proposed model, expectations of personal efficacy are derived from four principal sources of information: performance accomplishments, vicarious experience, verbal persuasion, and physiological states. The more dependable the experiential sources, the greater are the changes in perceived selfefficacy. A number of factors are identified as influencing the cognitive processing of efficacy information arising from enactive, vicarious, exhortative, and emotive sources. The differential power of diverse therapeutic procedures is analyzed in terms of the postulated cognitive mechanism of operation. Findings are reported from microanalyses of enactive, vicarious, and emotive modes of treatment that support the hypothesized relationship between perceived self-efficacy and behavioral changes. Possible directions for further research are discussed.

38,007 citations


"Entrepreneurship and growth" refers background in this paper

  • ...…on entrepreneurial cognition has tried to understand whether entrepreneurs use knowledge structures differently from non-entrepreneurs when they have to make sense of information, and has focused primarily on the role of scripts or schema (Fiske and Taylor, 1991) and self-efficacy (Bandura, 1977)....

    [...]

Book
01 Jan 1974
TL;DR: The authors described three heuristics that are employed in making judgements under uncertainty: representativeness, availability of instances or scenarios, and adjustment from an anchor, which is usually employed in numerical prediction when a relevant value is available.
Abstract: This article described three heuristics that are employed in making judgements under uncertainty: (i) representativeness, which is usually employed when people are asked to judge the probability that an object or event A belongs to class or process B; (ii) availability of instances or scenarios, which is often employed when people are asked to assess the frequency of a class or the plausibility of a particular development; and (iii) adjustment from an anchor, which is usually employed in numerical prediction when a relevant value is available. These heuristics are highly economical and usually effective, but they lead to systematic and predictable errors. A better understanding of these heuristics and of the biases to which they lead could improve judgements and decisions in situations of uncertainty.

31,082 citations

Book
01 Jan 1995
TL;DR: The Nature of Sensemaking Seven properties of sensemaking Sensemaking in Organizations Occasions for Sensemaking The Substance of Sense-making Belief-Driven Processes of Sense Making Action-driven Processes on Sensemaking.
Abstract: The Nature of Sensemaking Seven Properties of Sensemaking Sensemaking in Organizations Occasions for Sensemaking The Substance of Sensemaking Belief-Driven Processes of Sensemaking Action-Driven Processes of Sensemaking The Future of Sensemaking

13,400 citations


"Entrepreneurship and growth" refers background in this paper

  • ...…emphasised the processes by which individuals and groups extract patterns of meaning from ambiguous environments (e.g. Balogun and Johnson, 2004; Weick, 1995), as well as how these processes participate in construction of the social reality where individuals and groups operate (Anderson and…...

    [...]

  • ...Sense-making is commonly understood as a process in which individuals or groups attempt to interpret novel and ambiguous situations (Weick, 1995) when they face events or tasks that cannot be readily interpreted using available mental structures (Kiesler and Sproull, 1982)....

    [...]

Journal ArticleDOI
TL;DR: In this paper, the authors draw on the social and behavioral sciences in an endeavor to specify the nature and microfoundations of the capabilities necessary to sustain superior enterprise performance in an open economy with rapid innovation and globally dispersed sources of invention, innovation, and manufacturing capability.
Abstract: This paper draws on the social and behavioral sciences in an endeavor to specify the nature and microfoundations of the capabilities necessary to sustain superior enterprise performance in an open economy with rapid innovation and globally dispersed sources of invention, innovation, and manufacturing capability. Dynamic capabilities enable business enterprises to create, deploy, and protect the intangible assets that support superior long- run business performance. The microfoundations of dynamic capabilities—the distinct skills, processes, procedures, organizational structures, decision rules, and disciplines—which undergird enterprise-level sensing, seizing, and reconfiguring capacities are difficult to develop and deploy. Enterprises with strong dynamic capabilities are intensely entrepreneurial. They not only adapt to business ecosystems, but also shape them through innovation and through collaboration with other enterprises, entities, and institutions. The framework advanced can help scholars understand the foundations of long-run enterprise success while helping managers delineate relevant strategic considerations and the priorities they must adopt to enhance enterprise performance and escape the zero profit tendency associated with operating in markets open to global competition. Copyright  2007 John Wiley & Sons, Ltd.

9,400 citations


"Entrepreneurship and growth" refers background in this paper

  • ..., 2007), dynamic (Teece, 2007) and organisational capabilities (Salvato, 2009)....

    [...]

  • ...…of growth resonate with a renewed interest in the microfoundations of organisational processes in different fields of research, such as institutional theory (Greenwood et al., 2008), strategy (Jarzabkowski et al., 2007), dynamic (Teece, 2007) and organisational capabilities (Salvato, 2009)....

    [...]

Journal ArticleDOI
TL;DR: Across 4 studies, the authors found that participants scoring in the bottom quartile on tests of humor, grammar, and logic grossly overestimated their test performance and ability.
Abstract: People tend to hold overly favorable views of their abilities in many social and intellectual domains. The authors suggest that this overestimation occurs, in part, because people who are unskilled in these domains suffer a dual burden: Not only do these people reach erroneous conclusions and make unfortunate choices, but their incompetence robs them of the metacognitive ability to realize it. Across 4 studies, the authors found that participants scoring in the bottom quartile on tests of humor, grammar, and logic grossly overestimated their test performance and ability. Although their test scores put them in the 12th percentile, they estimated themselves to be in the 62nd. Several analyses linked this miscalibration to deficits in metacognitive skill, or the capacity to distinguish accuracy from error. Paradoxically, improving the skills of participants, and thus increasing their metacognitive competence, helped them recognize the limitations of their abilities.

5,376 citations


"Entrepreneurship and growth" refers background in this paper

  • ...This is due to the fact that entrepreneurs, like all other human beings, do not necessarily possess a full knowledge of their own skills and abilities and lack thereof (Kruger and Dunning, 1999)....

    [...]