Do strategy choices matter for nascent firms? A study on effectuation and causation impacts on new ventures outcomes

Principal Topic : Nascent entrepreneurship has drawn the attention of scholars in the last few years (Davidsson, 2006, Wagner, 2004). However, most studies have asked why firms are created focussing on questions such as what are the characteristics (Delmar and Davidsson, 2000) and motivations (Carter, Gartner, Shaver & Reynolds, 2004) of nascent entrepreneurs, or what are the success factors in venture creation (Davidsson & Honig; 2003; Delmar and Shane, 2004). In contrast, the question of how companies emerge is still in its infancy. On a theoretical side, effectuation, developed by Sarasvathy (2001) offers one view of the strategies that may be at work during the venture creation process. Causation, the theorized inverse to effectuation, may be described as a rational reasoning method to create a company. After a comprehensive market analysis to discover opportunities, the entrepreneur will select the alternative with the higher expected return and implement it through the use of a business plan. In contrast, effectuation suggests that the future entrepreneur will develop her new venture in a more iterative way by selecting possibilities through flexibility and interaction with the market, affordability of loss of resources and time invested, development of pre-commitments and alliances from stakeholders. Another contrasting point is that causation is ''goal driven'' while an effectual approach is ''mean driven'' (Sarasvathy, 2001) One of the predictions of effectuation theory is effectuation is more likely to be used by entrepreneurs early in the venture creation process (Sarasvathy, 2001). However, this temporal aspect and the impact of the effectuation strategy on the venture outcomes has so far not been systematically and empirically tested on large samples. The reason behind this research gap is twofold. Firstly, few studies collect longitudinal data on emerging ventures at an early enough stage of development to avoid severe survivor bias. Second, the studies that collect such data have not included validated measures of effectuation. The research we are conducting attempts to partially fill this gap by combining an empirical investigation on a large sample of nascent and young firms with the effectuation/causation continuum as a basis (Sarasvathy, 2001). The objectives are to understand the strategies used by the firms during the creation process and measure their impacts on the firm outcomes. Methodology/Key Propositions : This study draws its data from the first wave of the CAUSEE project where 28,383 Australian households were randomly contacted by phone using a specific methodology to capture emerging firms (Davidsson, Steffens, Gordon, Reynolds, 2008). This screening led to the identification of 594 nascent ventures (i.e., firms that are not operating yet) and 514 young firms (i.e., firms that have started operating from 2004) that were willing to participate in the study. Comprehensive phone interviews were conducted with these 1108 ventures. In a likewise comprehensive follow-up 12 months later, 80% of the eligible cases completed the interview. The questionnaire contains specific sections designed to distinguish effectual and causal processes, innovation, gestation activities, business idea changes and ventures outcomes. The effectuation questions are based on the components of effectuation strategy as described by Sarasvathy (2001) namely: flexibility, affordable loss and pre-commitment from stakeholders. Results from two rounds of pre-testing informed the design of the instrument included in the main survey. The first two waves of data have will be used to test and compare the use of effectuation in the venture creation process. To increase the robustness of the results, temporal use of effectuation will be tested both directly and indirectly. 1. By comparing the use of effectuation in nascent and young firms from wave 1 to 2, we will be able to find out how effectuation is affected by time over a 12-month duration and if the stage of venture development has an impact on its use. 2. By comparing nascent ventures early in the creation process versus nascent ventures late in the creation process. Early versus late can be determined with the help of time-stamped gestation activity questions included in the survey. This will help us to determine the change on a small time scale during the creation phase of the venture. 3. By comparing nascent firms to young (already operational) firms. 4. By comparing young firms becoming operational in 2006 with those first becoming operational in 2004. Results and Implications : Wave 1 and 2 data have been completed and wave 2 is currently being checked and 'cleaned'. Analysis work will commence in September, 2009. This paper is expected to contribute to the body of knowledge on effectuation by measuring quantitatively its use and impact on nascent and young firms activities at different stages of their development. In addition, this study will also increase the understanding of the venture creation process by comparing over time nascent and young firms from a large sample of randomly selected ventures. We acknowledge the results from this study will be preliminary and will have to be interpreted with caution as the changes identified may be due to several factors and may not only be attributed to the use/not use of effectuation. Meanwhile, we believe that this study is important to the field of entrepreneurship as it provides some much needed insights on the processes used by nascent and young firms during their creation and early operating stages.

Tax morale affects tax compliance : evidence from surveys and an artefactual field experiment

Our working hypotheses is that cross-cultural differences in tax compliance behaviour have foundations in the institutions of tax administration and citizen assessment of the quality of governance. Tax compliance being a complex behavioural issue. Its investigation requires use of a variety of methods and data sources. Results from artefactual field experiments conducted in countries with substantially different political histories and records of governance quality demondtrate that observed differences in tax compliance levels persist over alternative levels of enforcement. The experimental results are shown to be robust by replicating them for the same countries using survey response measures of tax compliance.

Inequality Aversion and Performance in and on the Field

The experimental literature and studies using survey data have established that people care a great deal about their relative economic position and not solely, as standard economic theory assumes, about their absolute economic position. Individuals are concerned about social comparisons. However, behavioral evidence in the field is rare. This paper provides an empirical analysis, testing the model of inequality aversion using two unique panel data sets for basketball and soccer players. We find support that the concept of inequality aversion helps to understand how the relative income situation affects performance in a real competitive environment with real tasks and real incentives.

Temperature and electric field dependent mobility in poly„3-hexylthiophene diodes

Current-voltage (I-V) curves of Poly(3-hexyl-thiophene) (P3HT) diodes have been collected to investigate the polymer hole-dominated charge transport. At room temperature and at low electric fields the I-V characteristic is purely Ohmic whereas at medium-high electric fields, experimental data shows that the hole transport is Trap Dominated - Space Charge Limited Current (TD-SCLC). In this regime, it is possible to extract the I-V characteristic of the P3HT/Al junction showing the ideal Schottky diode behaviour over five orders of magnitude. At high-applied electric fields, holes’ transport is found to be in the trap free SCLC regime. We have measured and modelled in this regime the holes’ mobility to evaluate its dependence from the electric field applied and the temperature of the device.

Field and Service Robotics Results of the 5th International Conference

The 5th International Conference on Field and Service Robotics (FSR05) was held in Port Douglas, Australia, on 29th - 31st July 2005, and brought together the worlds' leading experts in field and service automation. The goal of the conference was to report and encourage the latest research and practical results towards the use of field and service robotics in the community with particular focus on proven technology. The conference provided a forum for researchers, professionals and robot manufacturers to exchange up-to-date technical knowledge and experience. Field robots are robots which operate in outdoor, complex, and dynamic environments. Service robots are those that work closely with humans, with particular applications involving indoor and structured environments. There are a wide range of topics presented in this issue on field and service robots including: Agricultural and Forestry Robotics, Mining and Exploration Robots, Robots for Construction, Security & Defence Robots, Cleaning Robots, Autonomous Underwater Vehicles and Autonomous Flying Robots. This meeting was the fifth in the series and brings FSR back to Australia where it was first held. FSR has been held every 2 years, starting with Canberra 1997, followed by Pittsburgh 1999, Helsinki 2001 and Lake Yamanaka 2003.

In the Rough : In-Field evaluation of an autonomous vehicle for golf course maintenance

Maintenance is a time consuming and expensive task for any golf course or driving range manager. For a golf course the primary tasks are grass mowing and maintenance (fertilizer and herbicide spreading), while for a driving range mowing, maintenance and ball collection are required. All these tasks require an operator to drive a vehicle along paths which are generally predefined. This paper presents some preliminary in-field tsting results for an automated tractor vehicle performing golf ball collection on an actual driving range, and mowing on difficult unstructured terrain.

A point interpolation method with locally smoothed strain field (PIM-LS2) for mechanics problems using triangular mesh

A point interpolation method with locally smoothed strain field (PIM-LS2) is developed for mechanics problems using a triangular background mesh. In the PIM-LS2, the strain within each sub-cell of a nodal domain is assumed to be the average strain over the adjacent sub-cells of the neighboring element sharing the same field node. We prove theoretically that the energy norm of the smoothed strain field in PIM-LS2 is equivalent to that of the compatible strain field, and then prove that the solution of the PIM- LS2 converges to the exact solution of the original strong form. Furthermore, the softening effects of PIM-LS2 to system and the effects of the number of sub-cells that participated in the smoothing operation on the convergence of PIM-LS2 are investigated. Intensive numerical studies verify the convergence, softening effects and bound properties of the PIM-LS2, and show that the very ‘‘tight’’ lower and upper bound solutions can be obtained using PIM-LS2.

Delaying mismatched field multiplications in pairing computations

Miller’s algorithm for computing pairings involves perform- ing multiplications between elements that belong to different finite fields. Namely, elements in the full extension field Fpk are multiplied by elements contained in proper subfields F pk/d , and by elements in the base field Fp . We show that significant speedups in pairing computations can be achieved by delaying these “mismatched” multiplications for an optimal number of iterations. Importantly, we show that our technique can be easily integrated into traditional pairing algorithms; implementers can exploit the computational savings herein by applying only minor changes to existing pairing code.

Researching crime and violence: Untold stories from the field

Undertaking empirical research on crime and violence can be a tricky enterprise fraught with ethical, methodological, intellectual and legal implications. This chapter takes readers on a reflective journey through the qualitative methodologies I used to research sex work in Kings Cross, miscarriages of justice, female delinquency, sexual violence, and violence in rural and regional settings over a period of nearly 30 years. Reflecting on these experiences, the chapter explores and analyses the reality of doing qualitative field research, the role of the researcher, the politics of subjectivity, the exercise of power, and the ‘muddiness’ of the research process, which is often overlooked in sanitised accounts of the research process (Byrne-Armstrong, Higgs and Horsfall, 2001; Davies, 2000).