Resource title

Opportunities and new business models - Transaction cost and property rights perspectives on entrepreneurship

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Resource description

Entrepreneurs in a competitive economy face three fundamental problems. They need to search forand discover a business opportunity (Kirzner, 1973), evaluate it (Knight, 1921), and then seize theopportunity to reap entrepreneurial profits (Schumpeter, 1911) (Langlois, 2007). The problem thatwe address is how the ability to exploit business opportunities is influenced by entrepreneurial searchand the economic organization of entrepreneurship (Arrow, 1962; Lippman & Rumelt, 2003; Aghionet al., 2005; Foss et al., 2007). In many cases, the discovery for a new business opportunity needs tobe motivated by expected gains, since the search and evaluation of business opportunities is a costly,resource-consuming process (Denrell, Fang & Winter, 2003; Nickerson & Zenger, 2004; Foss &Klein, 2005; Teece, 2007; Foss & Foss, 2008).1 We show the critical role of expectations forunderstanding of the economic organization of entrepreneurship, and argue that transaction costeconomics, with its insistence on bounded rationality, but far-sighted contracting offers usefulinsights and presents rich opportunities for further theoretical and empirical research (cf. alsoFurubotn, 2002).

Resource author

Nils Stieglitz, Nicolai J. Foss

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Resource language

eng

Resource content type

application/pdf

Resource resource URL

http://hdl.handle.net/10398/7784

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