Discovery and Creation: Alternative Theories of Entrepreneurial Action

By Sharon A. Alvarez, Jay B. Barney. 2007

2,344 citations recorded by the source corpus.

Two theories of entrepreneurial action - Discovery Theory and Creation Theory - are discussed. While Discovery Theory and its assumptions have been addressed in the literature, neither the assumptions of Creation Theory nor how they are related to the assumptions of Discovery Theory have yet been discussed. The empirical implications of these two theories for research on entrepreneurial action, generally, and for three specific entrepreneurial actions - entrepreneurial decision making, business planning, and new venture financing - in particular, are then discussed. It is shown that these two theories will often make contradictory predictions about the effects of entrepreneurial actions on the ability of entrepreneurs to produce new products or services.

Subfields: Accounting, Management of Technology and Innovation, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/39c36689a6d74aee18138e352ca8917c825d4cf1

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In Management of Technology and Innovation

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Citations in the corpus

The Concept of International Opportunity in International Entrepreneurship: A Review and a Research Agenda (2014, neutral): “They exist regardless of whether people are aware of their existence (Alvarez and Barney 2007).”
The Co-Evolution of Organizational Value Capture, Value Creation and Sustainable Advantage (2009, neutral): “I @ B 8 - 3 6 8 # 7 F 6”
Creating the Future Together: Toward a Framework for Research Synthesis in Entrepreneurship (2014, background): “Moreover, Alvarez and colleagues (Alvarez & Barney, 2007, 2010; Alvarez, Barney, & Young, 2010) recently reviewed a sample of both positivist and narrative studies in this area and concluded these studies draw on epistemological assumptions that are mutually exclusive, which would impede…”
Managing the Unknowable (2015, background): “Although there is a great deal of research on uncertainty and numerous distinctions in this literature (e.g, risk vs. uncertainty in creation theory, Knight, 1921; Alvarez and Barney, 2007), recently scholars have framed extreme uncertainty as unknowable risks (Diebold, Doherty, and Herring, 2010).”
Strategic Entrepreneurship: Creating Value for Individuals, Organizations, and Society (2011, positive): “Alvarez and Barney (2007) argued that there are two theories of entrepreneurial action: discovery of existing opportunities and creation of new opportunities.”
The Effects of Business Failure Experience on Successive Entrepreneurial Engagements: An Evolutionary Phase Model (2018, background): “Thus, an entrepreneurship theory of the firm is that once an entrepreneurial firm is inclined to take risk to innovate proactively, new product-market entry and wealth creation should follow (Alvarez & Barney, 2007; Lumpkin & Dess, 1996).”
The role of entrepreneurial decision-making in opportunity creation and recognition (2015, background): “This camp of entrepreneurship scholars argue that “opportunities, like mountains, exist as a real and objective phenomena, independent of the actions or perceptions of entrepreneurs, just waiting to be discovered and exploited” (Alvarez and Barney, 2007: p. 13).”
To Shape or Adapt: Knowledge Problems, Epistemologies, and Strategic Postures under Knightian Uncertainty (2020, background): “Epistemologies have been highlighted as important for understanding the fundamentally different approaches that entrepreneurs take to pursue opportunities—by discovering or creating them (Alvarez & Barney, 2007, 2010).”
Entrepreneurship in Russia and China: The Impact of Formal Institutional Voids (2010, background): “As such, they must usually be more than passive actors or discoverers reacting to the environment as in discovery theory, and instead be creators who take actions to influence their environment, seen as creation theory (Alvarez & Barney, 2004, 2007).”
Capital is not enough: opportunity entrepreneurship and formal institutions (2018, neutral): “Entrepreneurs are alert to new opportunities (Kirzner 1973) and use opportunity recognition (Shane 2000) to exploit existing profitable opportunities, but they also use an active creative process (Alvarez and Barney 2007) to pursue entrepreneurial opportunities.”
Affordable loss: behavioral economic aspects of the plunge decision (2009, background): “…entrepreneurship It is perhaps not an accident that the very fi rst article in the special launch issue of the Strategic Entrepreneurship Journal outlines the alternative possibilities of studying entrepreneurship as an engine of making, and not merely one of discovery (Alvarez and Barney, 2007).”
Planned Luck: How Incubators Can Facilitate Serendipity for Nascent Entrepreneurs Through Fostering Network Embeddedness (2020, background): “This decision resonates with research showing the survival of enterprises depends on their ability to tackle uncertainty (Alvarez & Barney, 2007; McMullen & Shepherd, 2006), and that early- stage entrepreneurs often do not know yet which resources, partners, or co- founders they might need…”