Kirzner’s Theory Of Entrepreneurship-A Critique

Ricketts, Martin; Kirzner, Israel M.

doi:10.1007/978-94-011-2186-6_3

Cited by 23 publications

(16 citation statements)

References 4 publications

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“…Alertness is problematic for wealth creation because it can only provide for the ‘discovery’ of ways of diverting resources from one person to another (Ricketts, 1993). Nor does alertness provide for entrepreneurs being ‘a source of ideas ex nihilo, but .…”

Section: The Alertness Perspective On Identifying Discoveriesmentioning

confidence: 99%

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A Prescriptive Analysis of Search and Discovery*

Fiet

2007

J Management Studies

193

200

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I develop a prescriptive model of entrepreneurial search and discovery, which operationalizes constrained, systematic search. This approach appears to be superior to the alertness perspective in both the number and the wealth-creating potential of the opportunities that it can assist entrepreneurs to discover. Essentially, this research shows how entrepreneurs can improve their search effectiveness by systematically restricting their searching to known domains, which I elaborate prescriptively. Finally, I discuss the implications of the approach for researchers, educators and entrepreneurs. Copyright Blackwell Publishing Ltd 2007.

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Section: The Alertness Perspective On Identifying Discoveriesmentioning

confidence: 99%

“…. as responding to opportunities rather than creating them’ (Ricketts, 1993, p. 73). Thus, an economic system depending on alertness alone for its vitality eventually runs down even though those who discover the opportunities may individually be better off.…”

Section: The Alertness Perspective On Identifying Discoveriesmentioning

confidence: 99%

A Prescriptive Analysis of Search and Discovery*

Fiet

2007

J Management Studies

193

200

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“…This tradition views the market as a process, which is never really in equilibrium, but is always tending toward it. The underlying theme differentiating this view from the neoclassical perspective is that the exploitation of gains from trade will not take place automatically (Ricketts, ). Disequilibrium exists because economic actors are ignorant and are often ignorant of their ignorance.…”

Section: The Market Process and The Role Of Entrepreneurshipmentioning

confidence: 99%

“…As summarized by Ricketts () (see also Buchanan and Vanberg, ), the Kirznerian model assumes an objectively existing and stable benchmark for the ‘state of the arts’ allowed by the technological, scientific, and legal background conditions. The Kirznerian entrepreneurs discover the unexploited profit possibilities allowed by this state of the arts until all opportunities are exhausted, but they do not act to change the state of the art itself.…”

Section: The Market Process and The Role Of Entrepreneurshipmentioning

confidence: 99%

The Equilibrating and Disequilibrating Effects of Entrepreneurship: Revisiting the Central Premises

Keyhani

Lévesque

2015

Strategic Entrepreneurship

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Research summary:We review existing theoretical propositions on the equilibrating and disequilibrating effects of entrepreneurship in the market process. We then introduce a game theoretical model of the market process and employ computer simulation to analyze it through time. The formal analysis suggests that entrepreneurship as the creation of new opportunities may not always be disequilibrating, and entrepreneurship as the discovery and exploitation of existing opportunities may not always be equilibrating. We identify specific conditions that produce counterexamples to the generic equilibration and disequilibration propositions previously considered to be the central premises of entrepreneurship research.Managerial summary: Many entrepreneurs advance society by building businesses around creative new ideas. Yet, other entrepreneurs start businesses by discovering opportunities to profit without necessarily innovative ideas. In reality, most entrepreneurship involves both creation and discovery. We run computer simulations of a small hypothetical economy to analyze the impact of creation and discovery actions on the extent to which the economy contains unexploited opportunities at any given time. Our results largely support previous ideas on how entrepreneurs help clear the markets by discovering opportunities or how innovations disrupt the market through creative destruction. Our results also highlight ways in which these ideas may be oversimplified and may have boundary conditions.

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“…They portray the entrepreneur as a coordinating agent who is capable of exploiting unnoticed opportunities because of, as Kirzner puts it, special 'alertness'. In specific, Kirzner's entrepreneur takes more 'the form of a humble peddler at the fair than a contestant in the lists' (Ricketts 1992. p. 68).…”

Section: Other Theories Of Entrepreneurshipmentioning

confidence: 99%

Buridan's Ass, Risk, Uncertainty, and Self‐Competition: A Theory of Entrepreneurship

Khalil¹

1997

Kyklos

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SUMMARY The paper defines entrepreneurship as about ‘self‐competition’, the quest to test self‐ability: Can a future self achieve greater goals than what has been so far achieved? Self‐competition involves the development of ability and, hence, ex post assessment of ability is uncertain. Such uncertainty occasions either immobilizing anxiety (Buridan's ass) or entrepreneurial action. No such uncertainty surrounds the assessment of risk probability characterizing events such as floods and stock market crashes. An observable prediction of the proposed uncertainty/risk dichotomy is that insurance, which concerns risk, cannot crowd out religion and other belief systems which appeal to uncertainty. ZUSAMMENFASSUNG In diesem Papier wird Unternehmertum im Sinne von ‘Selbst‐Konkurrenz’ deftniert, als Streben, die eigenen Fähigkeiten unter Beweis zu stellen: Kann das zukünftige Ich höhere Ziele als bisher erreichen? Selbst‐Konkurrenz beinhaltet die Entwicklung von Fähigkeiten, und daher ist deren ex post Einschätzung unsicher. Diese Unsicherheit führt entweder zu einer lähmenden Angst (Burdians Esel) oder zu unternehmerischer Aktivität. Im Gegensatz dazu ist die Einschätzung der Risikowahrscheinlichkeit von Überschwemmungen oder Kursschwankungen an der Börse nicht von einer solchen Unsicherheit geprägt. Als beobachtbare Voraussage aus der vorgeschlagenen Unsicher‐heit/Risiko‐Dichotomie heraus ergibt sich, dass eine dieses Risiko betreffende Versicherung nicht in der Lage ist, Religion und andere Glaubenssysteme, die sich auf Unsicherheit bezichen, zu verdrängen. RÉSUMÉ Ce papier définit ľesprit entrepreneur comrne ‘une concurrence de soi’, la quete d'éprouver la capacityé de soi: Est‐ce possible qu'un futur‐soi puisse achever de plus grands buts qu'il a déjà accomplis? Une concurrence de soi consiste du développcinent de sa capacityé, done, ľévaluation ex past de cette capacityé n'est pas certaine. Une telle incertitude mène à une anxiété paralysante (ľǎne de Buridan) ou àľ action entreprenante. Une incertitude de la sorte n'entoure pas ľévaluation de la probabilityé de risque qui caractérisent les événements tels comme ľ inondation ou la chute de la Bourse. Une prédiction qu'on petit observer de la dichotomie proposée incertitude/risque, c'est que ľ assurance, qui concerne le risque, doit laisser de place aux réligions et aux autres systèmes de croyance qui invoquent ľ incertitude.

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Kirzner’s Theory Of Entrepreneurship-A Critique

Cited by 23 publications

References 4 publications

A Prescriptive Analysis of Search and Discovery*

A Prescriptive Analysis of Search and Discovery*

The Equilibrating and Disequilibrating Effects of Entrepreneurship: Revisiting the Central Premises

Buridan's Ass, Risk, Uncertainty, and Self‐Competition: A Theory of Entrepreneurship

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