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Career motives and entrepreneurial decision-making: examining preferences for causal and effectual logics in the early stage of new ventures

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Abstract

The influence of entrepreneurs’ career motives is examined on two alternative modes of decision-making logic; causation and effectuation. Based on Sarasvathy’s (Acad Manage Rev 26(2):243–288, 2001) seminal study, causation is defined as a decision-making process that focuses on what ought to be done given predetermined goals and possible means, and effectuation as a decision-making process emphasizing the question of what can be done given possible means and imagined ends. Analysis suggests that entrepreneurs who identify themselves with linear or expert career motives have a higher preference for causal decision-making logic. Entrepreneurs who identify themselves with spiral or transitory career motives have a higher preference for effectual decision-making logic. In addition, indications that prior start-up experience moderates the relationship between career motives and effectual decision-making logic for spiral-minded entrepreneurs is found. The overall results give ample support for the assumption that entrepreneurs’ career motives influence their decision-making.

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Notes

  1. Sarasvathy (2008, p. 17) defines logic as an internally consistent set of ideas that forms a clear basis for action upon the world.

  2. The expert career motive should not be confused with Sarasvathy’s notion of ‘expert entrepreneurs’ which was the source for her identification of effectuation as a decision-making logic. According to Sarasvathy, expert entrepreneurs are individuals who through deliberate practice have learned to master the different staged elements of the entrepreneurial process (Sarasvathy 2001; Sarasvathy and Dew 2005). Individuals with an expert career motive, on the other hand, are searching for skill mastery in a specialized work area or craft in a stable environment. The ‘expert’ career motive and ‘expert entrepreneurs’ consequently refer to different things, although they use the same label.

  3. This choice seems to be in line with other attempts to operationalize causal and effectual decision-making logics that we have discovered more recently (e.g., Wiltbank et al. 2009).

  4. The education industry includes, for example, private schools and firms offering different kinds of staff and labor market training.

  5. Cronbach’s alpha can be a relatively weak indicator of internal consistency when few variables are employed in a composite measure.

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Acknowledgements

We would like to thank two anonymous reviewers for their helpful comments in the course of developing this work. We are also grateful for the valuable help from Professor Rikard Larsson when constructing our measures of career motives.

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  1. Lund University, Lund, Sweden

    Jonas Gabrielsson

  2. Halmstad University, Halmstad, Sweden

    Diamanto Politis

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  1. Jonas Gabrielsson
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Correspondence to Jonas Gabrielsson.

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Table 4 Factor analysis of causation and effectuation measures
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Gabrielsson, J., Politis, D. Career motives and entrepreneurial decision-making: examining preferences for causal and effectual logics in the early stage of new ventures. Small Bus Econ 36, 281–298 (2011). https://doi.org/10.1007/s11187-009-9217-3

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