Relationship between human capital, new venture ideas, and opportunity beliefs: A meta‐analysis

Abstract

Research summary We meta‐analyze the structural relationship between human capital, the ability to generate new venture ideas, and the favorability of opportunity beliefs to address divergent theoretical predictions and inconsistent empirical findings. We test a two‐stage process model of entrepreneurial opportunity identification, distinguishing between the ability to generate new venture ideas and the favorability of third and first‐person opportunity beliefs. We also distinguish between two categories of human capital: general and specific human capital. Our results suggest that general and specific human capital are positively associated with the ability to generate new venture ideas. Furthermore, only specific human capital matters in influencing the favorability of opportunity beliefs, yet the ability to generate new venture ideas is far more important than human capital for the favorability of opportunity beliefs. Managerial summary How does an individual's human capital relate to the attractiveness of opportunities identified? In this study, we review the body of literature on this topic and analyze the relationships between two types of human capital—general and specific human capital, the ability to generate new venture ideas, and the attractiveness of opportunities. We find that both general human capital—primarily education and work experience—and specific human capital—industry and entrepreneurial experience—are useful for generating new venture ideas. However, only specific human capital is useful when assessing which new venture ideas can turn into attractive opportunities. We also find that the ability to generate new venture ideas is more strongly associated with the attractiveness of opportunities than either type of human capital.

The growth of entrepreneurial human capital: origins and development of skill variety

“…What predicts entrepreneurial success? A great deal of research investigating these fundamental questions has focused on human capital (Canavati et al, 2021;Davidsson & Gordon, 2012;Unger et al, 2011). According to Becker (1964), human capital is composed of knowledge and skills that are acquired through schooling, on-the-job training, and other kinds of experience.…”

Moderated Mediating Mechanism Effects of Chinese University Entrepreneurship Education on Independent Student Entrepreneurship

“…It not only helps individuals to acquire entrepreneurial knowledge and skills from past experience ( Tornikoski and Newbert, 2007 ), as well as master valuable market and product information ( Clarysse et al, 2013 ), but also helps entrepreneurs to identify entrepreneurial opportunities in related fields ( Yu et al, 2021 ). Entrepreneurial experience can affect the behavior of entrepreneurs ( Tihula and Huovinen, 2010 ), for example, it can affect the individual judgment on the feasibility of entrepreneurial opportunities ( Canavati et al, 2021 ), give full play to the ability of entrepreneurial opportunity identification ( Ucbasaran et al, 2003 ), and improve entrepreneurial willingness ( Graevenitz et al, 2010 ).…”

Entrepreneurship at a crossroads: Meta‐analysis as a foundation and path forward

“…In the final article, Canavati, Libaers, Wang, Hooshangi, and Sarooghi (2021) unpack factors that shape opportunity identification—a central research topic within entrepreneurship (Busenitz, Plummer, Klotz, Shahzad, & Rhoads, 2014; Short, Ketchen, Shook, & Ireland, 2010). They use meta‐analysis to consolidate evidence from 126 studies to examine factors that shape idea generation (i.e., ideation) and different entrepreneurial attributes that shape whether ideas are considered viable opportunities.…”

“…They use meta‐analysis to consolidate evidence from 126 studies to examine factors that shape idea generation (i.e., ideation) and different entrepreneurial attributes that shape whether ideas are considered viable opportunities. Leveraging insights from human capital theory, Canavati et al (2021) distinguish between general (e.g., education‐based) and specific (i.e., experience‐based) human capital, and report that, although both types of human capital are positively associated with new idea generation, only specific human capital is positively associated with the belief that a new idea is viable—whether it be for the specific entrepreneur (i.e., first‐person opportunity) or for someone else (i.e., third‐person opportunity). By providing foundational knowledge about antecedents to idea generation and evaluation, the study informs the ongoing debate about the nature of opportunities and their recognition and/or creation (e.g., Alvarez & Barney, 2020; Davidsson, 2015; Wood & McKinley, 2010).…”