A third wave for entrepreneurship research: mending the split between causation and effectuation through complexity

Abstract

In this paper we propose that the theoretical framework for understanding entrepreneurship of Effectuation as developed in Sarasvathy (2001) can be reframed as a subset of complexity management as proposed by Nason (2017). Doing so has five main advantages. Firstly, it places effectuation as part of the well-developed theory of complexity science. This in turn allows for a refinement of the concepts of effectuation as they are reframed in the language of the more widely studied concepts of complexity science. Secondly, it separates the false dichotomy between causation and effectuation and recasts it into complementary complicated and complex systems whose selection for appropriateness depends on the specific underlying context or system of the entrepreneurial venture. Thirdly, it expands the applicability of the concept of effectuation beyond the purview of the entrepreneur into general management regardless of the scope, scale or development of the business organization in question. Fourthly, it changes the discussion of the criticisms of effectuation by showing many criticisms are based on incorrect methodologies for examining complex systems and non-reductionist systems. Finally, the recasting of effectuation as a subset of complexity management, helps to reinforce that complexity is a valid concept to expand from the social sciences where it is well accepted into the business literature where the study of complexity is in many ways still in its nascent stages.