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29 Cards in this Set
- Front
- Back
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Why is there an absense of the entrepreneur in neoclassical theory? |
It's based on equilibrium No place for the entrepreneur, who is excluded by definition (seeks disequilibrium) In equilibrium, the entrepreneur has already left |
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What are unrealistic expectations on entrepreneurial theory? |
Formalization and heterogenity Entrepreneurship is the ultimate "unstandardized" product, cannot be explained by neat formulas (making it difficult for theory construction) |
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How can investment theory be a step towards formalizing theory on innovation and entrepreneurship? |
Similar characteristics - Unprectability of return - High risk, uncertain fruitation - Operating with other people's money |
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How can mainstream theory of distribution/production be applied to entrepreneurship? |
Supply - Will switch locus of activity to where pay-offs are attractive (recognizing disequilibrium) Allocation of resources - Where are the relative rewards? - Productive vs. Un-productive entrepreneurship - Activity can be relocated if relative benefits are modified Pricing / Earnings - Drawn to temporary monopoly benefits / entrepreneurial profit Demand - Problematic; activity is by definition not typically demanded by others - Can be implicitly "demanded" by low taxes, beneficial regulations etc. |
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What are the five typologies of innovation (Schumpeter)? -> Capitalist entrepreneurship |
- Raw materials - Production - Good - Market - Organization (of industry) |
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How does capitalist entrepreneurship differ from general entrepreneurship? |
Profit |
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How can resistance to new order manifest itself? |
- Task - Psyche - Social environment (- Norms) |
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What does entrepreneurship leading to new combinations entail? |
Breaking up an existing order The entrepreneur orients her behavior in a negative way to the old order to make profit |
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Explain the terms "order", "resistance", "combination", "experimentation", "competing up", "new combination", "entrepreneurial profit", "competition", "competing down" and "new order". |
Theory of Capitalist Entrepreneurship |
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How is capitalist entrepreneurship both economical and social? |
Economical --> profit-driven (combination/new combination, breaking up order for gains) Social --> behavior (order/resistance; experimentation/competition) |
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What are the entrepreneurial strategies proposed by Drucker? |
Fustest of the mostest - Dominance, leadership, being "most on the ball", all or nothing, no room for mistakes Hit them where they aint - Creative imitations - exploiting success of others - Entrepreneurial judo - exploiting weaknesses of others Ecological niche - Monopoly in small area New combinations - Changing and adapting characteristics |
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What are typical mistakes to take advantage of in entrepreneurial judo? |
Markets / products not defended - Not-invented-here arrogance - Creaming markets - Premium pricing - Quality (it is in the eye of the customer) - Trying to satisfy (maximize) everyone |
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What are the benefits and risks of creative imitation? |
Benefit: market established, the new is accepted, creator has failed to recognize own success Risk: Creator gets it right first time |
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What are the entrepreneurial strategies that work (according to Bhide)? |
1. Screen out losers 2. Frugal planning and analysis 3. Integrating action and analysis |
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What might you consider when "screening out losers"? |
- Objectives - External changes - Competition - Market - Risks and rewards - Adequacy of idea - Capability to execute - Passion of entrepreneur |
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What key factors are important in the frugal planning of the entrepreneur? |
- What must go right - Potential pitfalls (- Risks and rewards) |
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What does "evangelical investigation" mean? |
Blurring the lines between research and selling |
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Why should you not plan and analyze too much? |
It takes time and money, and you might miss an opportunity |
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What "entrepreneurial means" does an entrepreneur have? |
- Personal traits (who they are) - Knowledge (what they know) - Social network (whom they know) |
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What is the difference between causation and effectuation? |
Focus on goals vs. Focus on means |
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What are the four principles of effectuation? |
- Affordable loss - Alliances - Exploiting contingencies - Controllable aspects of unpredicable future |
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What are key determinants of opportunity recognition? |
- Information (asymmetry) - Prior knowledge - Entrepreneurial alertness (- Social networks) |
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How is disequilibrium connected to information about opportunity ("entrepreneurial discovery")? |
- Possibility to better allocate resources - Only one or few know about it (asymmetry) |
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Why is price an incomplete indicator of opportunity? |
It says nothing about the future potential profit or errors of judgement in the price setting |
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What is the locus of change in recognizing entrepreneurial opportunity? |
--> Typology of innovations Raw materials; Production; Goods; Market; Organization |
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What are the sources of opportunity? |
- Informtion asymmetry - Exogenous shocks - Supply/demand changes - Changes in productive/unproductive opportunities |
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Why is the initiator of change of importance? |
Because it will affect how people discover opportunity (uni, business, government, entrepreneurs) |
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Is search or immediate recognition more likely in the entrepreneurial discovery process? |
Immediate recognition - you dont know what you are looking for |
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Why is a decentralized innovation process perhaps more beneficial than a centralized? |
Since people with different background and greater diversity have greater chance of identifying different opportunities |
