The Strategic Advantage of Impulsivity in Entrepreneurial Action: An Agent-Based Modeling Approach

Abstract

Our study extends and enhances entrepreneurial action theory (EAT) by considering the strategic advantage or disadvantage of impulsive action. To date, EAT has largely sidestepped the role of dispositional impulsivity, limiting its veridicality and inclusivity. Popularized notions of celebrity entrepreneurs and an increasingly large body of empirical research on the prevalence of impulsivity have inspired a reassessment of what drives entrepreneurs. Looking beyond both the anecdotes and well-established prevalence of impulsivity, we develop and illustrate a novel theory concerning the fate of impulsive nascent entrepreneurs who are wired for nondeliberative, less-calculative action. We use an agent-based model and conduct simulation-based experiments involving 2.7 million virtual entrepreneurs to identify and explicate the specific conditions under which impulsivity does or does not generate strategic advantage. Accordingly, we contribute a broader and deeper theorization of EAT, taking notable steps toward the inclusion of nontraditional entrepreneurs and the varied impacts of impulsive action in this domain’s evolving conception of new venture emergence.

Are Entrepreneurs Probabilists or Possibilists? Observing Opportunity as Possibilities, Probabilistically

“…The synthesis of signalling theory and opportunity recognition within the Many-Doors framework allows for a holistic view of the entrepreneurial process from the nascent impulsive actions driven by raw signals to the more refined, rational strategies underpinned by comprehensive opportunity assessments. This integration clarifies the individual roles and impacts of impulses and rational decisions in entrepreneurial activities [67]. It illustrates how these components are interconnected through continuous information feedback loops [68].…”

“…This model supports a deeper understanding of how entrepreneurs navigate uncertainty, a core aspect of entrepreneurial studies. It offers a novel way to synthesize various theoretical perspectives, such as impulsivity in decision-making linked to behavioural economics [67] and the rational analysis rooted in traditional business strategy theories. The significance of the Many-Doors model lies in its ability to articulate a clear, actionable framework that helps decode the complex nature of entrepreneurial decision-making.…”