Entrepreneurial Paradoxes

2 November 2010 at 6:36 am 12 comments

| Peter Klein |

A new working paper from the always-interesting Peter Lewin: “Entrepreneurial Paradoxes: Implications of Radical Subjectivism.” Sample paradoxes:

  • Entrepreneurial opportunities are complicated by uncertainty but would not exist without uncertainty.
  • An entrepreneurial opportunity for everyone is an opportunity for no one in particular.
  • Entrepreneurial opportunities are subjective and objective; discovered and created.

See the paper for the full set of paradoxes and some informative and challenging discussion.

Entry filed under: - Klein -, Austrian Economics, Entrepreneurship, Management Theory, Myths and Realities, Recommended Reading.

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12 Comments Add your own

  • 1. would love to chat in copenhagen about this  |  2 November 2010 at 7:38 am

    All due respect to the author, because the manuscript sounds interesting as a whole. But these sample one-sentence ‘paradoxes’ are not really genuine paradoxes. Here’s my 2 cents.

    > “Entrepreneurial opportunities are complicated by uncertainty but would not exist without uncertainty.”

    So what? I can say the same thing about insurance and uncertainty, or contracts and uncertainty. Or “life” and uncertainty. I’m not sure how the ‘paradox’ is exclusive to entrepreneurial opportunity, much less to say in an interesting way.

    > “An entrepreneurial opportunity for everyone is an opportunity for no one in particular.”

    This ‘paradox’ is loaded with inconsistent meanings for the same word. What does the first ‘opportunity’ mean, compared to the second ‘opportunity’? For that matter, what does the first ‘for’ mean, compared to the second ‘for’?

    I submit that, on the face of it, this is mainly a case of gratuitous flexibility in word meaning disguised as a paradox.

    > “Entrepreneurial opportunities are subjective and objective; discovered and created.”

    I could say the same thing about the epistemology of ANY physical object, or the linguistic meanings associated with ANY word or word phrase, much less to say “entrepreneurial opportunity.”

    No, if we want to be more concrete about this third faux-paradox, we need to split up this concept of opportunity into component parts. Recent work on opportunity conceptualizes it as problem/solution pairs, whereby arguments can be made that valuable consumer problems can be generated or ‘discovered’ (out of ‘thin air’, for the lack of a better term), as opposed to inventive solutions that are ‘created’ by combining resources in the Schumpeterian sense.

    A recent paper floating around (google “entrepreneurship humor ssrn”) argues that we may be focusing too much on the concept of ‘opportunity,’ a too-broad concept that confuses due to the word ‘can’ in its oft-cited definitions. An ‘opportunity recursiveness dilemma’ emerges. The paper argues for adopting Drucker’s 1980’s term ‘incongruity’, the concept of which he suggests is a ‘symptom of opportunity.’ To inform propositions about incongruity — unfortunately relatively glossed over or neglected in entrepreneurship research — the paper borrows from humor research. And proposes, loosely speaking, that the structure of an ‘entrepreneurial opportunity’ may be usefully approximated by the structure of a ‘joke.’

  • 2. Peter Klein  |  2 November 2010 at 8:40 am

    Um, did you actually read the paper, or just the three bullet points? Each is a summary statement of a detailed discussion.

    (BTW I agree that opportunities per se should not be the unit of analysis. This is a major theme of my 2008 SEJ paper.)

  • 3. Copenhagen  |  2 November 2010 at 10:08 am

    Hi Peter, yes, is that 2008 SEJ paper the one cited in the very first paragraph of the introduction of that humor paper? Inquiring minds want to know. :)

    Well, no, I didn’t read the Lewin paper yet, but it’s still fair to critique the claims that these are paradoxes. I believe genuine paradoxes are unmistakeably a paradox within the first few sentences… the more text that one takes to DESCRIBE a paradox, the more it becomes obvious that the ‘paradox’ is nothing more than a simple non-logical sentence injected with highly complicated and conditional meaning.

    Anyways, if these are paradoxes, why should we stop here? Let’s just take off the kid gloves and hit a grand slam with:

    “What’s right is wrong and what’s wrong is right.”

    I love it, personally. And I’ll bet big money that you’ll find more than a handful of entrepreneurs who will subscribe to just such a “paradox.” Now if only somebody could publish a paper on it…

  • 4. Peter Lewin  |  2 November 2010 at 12:09 pm

    Hmm, I am somewhat at a loss to know how to respond to a critic who relishes the fact that he has not read the paper under discussion. I am taken to task, as far as I can tell, for not using the word “paradox” correctly.

    A quick search reveals the following:
    Paradox –noun:
    1. a statement or proposition that seems self-contradictory or absurd but in reality expresses a possible truth.
    2. a self-contradictory and false proposition.
    3.any person, thing, or situation exhibiting an apparently contradictory nature.
    4.an opinion or statement contrary to commonly accepted opinion.

    I fail to see how my “paradoxes” do not fit, especially definition 1.

    So what is the purpose of the comment? To vent anger? I guess Mr. Copenhagen was annoyed by the apparently gimmicky nature of my approach and wanted to beat me up for it. Maybe he would now like to read the paper and we can discuss its substance.

    By the way, critique is a noun, criticize is the appropriate verb.

  • 5. copenhagen  |  2 November 2010 at 12:57 pm

    i’m not sure how i “relished” the fact that i had not read it. in fact, i explicitly said i would. but in the meantime i see no problem in offering a first impression based on a few bullet points. citing an article or its contents does not necessitate reading the entire thing — if that were the case, academia wouldn’t have half of its literature because everybody would be reading themselves to death. it is simply up to the author to make the abstract and wording precise to avoid the misunderstandings that potentially follow.

    sheesh. all this even after i explicitly said i’d read the thing. i hope to be back on here.

    i like the obvious reference to dictionary.com for the lax definition of ‘paradox’ (c.f. Lewin and Phelan, CMR 1999) but i like EVEN MORE that dictionary.com treats ‘critique’ as a verb. gotta love it. cheers.

    > By the way, critique is a noun, criticize is the appropriate verb.

  • 6. Peter Lewin  |  2 November 2010 at 3:35 pm

    No, it is not good form to criticize something without reading it, based on some bullet points. Forgive me for thinking your intention was to belittle rather than to make substantive points. I am from the school of etiquette which tries to give the most charitable interpretation to a text. If that was not your intention, if you have something important to say, I would love to hear it. Feel free to read the article and to like it.

    Reading your comments above confirms to me your contemptuous tone and gives the lie to your later indignation.

    “the ‘paradox’ is nothing more than a simple non-logical sentence injected with highly complicated and conditional meaning.” and so on.

    This is a particularly uncharitable approach. The “paradoxes” are obvious teasers, which you would have known if you read the article. I deal with some of the points you make about “opportunity” and what it means. The article is meant to be provocative look at some of the recent literature on entrepreneurial opportunities in contrast to the “standard model” (like the resource based approach in management and the competitive model in economics). You may think it has nothing new or that what it says is wrong. But first you have to read it.
    The New Shorter Oxford English Dictionary:
    Paradox: A seemingly absurd or self-contradictory statement or proposition which, when investigated or explained, may prove to be well-founded or true.

    It also confirms the possible use of “critique” as a verb (bowing, I guess to common – as opposed to pure or sophisticated – usage). I suppose I would find the same with the word “impact” – which should be a noun but has been Americanized into a verb in place of “affect.” Language evolves, who am I to critique it?

  • 7. Copenhagen  |  2 November 2010 at 3:46 pm


  • 8. Henri  |  4 November 2010 at 3:10 am

    Brings to my mind the AMA (annals) article on philosophy and entreprenuership by Alvarez & Barney. Among many very puzzling statements in the paper (e.g. Carnap as a critical realist!), I could not understand how theorizing of entrepreneurial opportunities (something that cannot be obsered directly at all) has anything to do with critical realism?

    Wouldn’t opportunities be like the most metaphysical thing in our field since they per se be inferred to exist unless they were successfully pursued. I always thought the ethos of critical realism was to go about examining nitty gritty causal mechanisms in greater detail.

    More broadly, what would Popper say about this talk of entrepreneurial opportunities? Is it not a completely unfalsifiable suggestion to say that successful entrepreneruship is dependent on the identification of (genuinely “existing”) opportunities?

    Wow. Ok. I am calm now.

  • 9. Henri  |  4 November 2010 at 3:11 am

    per se cannot be inferred, sorry for the typo.

  • 10. Rafe  |  4 November 2010 at 7:03 am

    Speaking as Popper’s champion in Australia, he would probably start off with a disclaimer that he did have any undestanding of commercial activities. He would then say that the commercial entrepreneur operates like a research scientist, (or indeed anyone going about their daily activities) making conjectures that may be falsified by events (or not).

  • 11. Rafe  |  4 November 2010 at 7:13 am

    Champion of Mises as well!

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