Entrepreneurial causation and effectuation logics in a regional context: Assessing the importance of population density

ABSTRACT

The purpose of the article is to assess whether an entrepreneurial causation or effectuation logic is a function of geographical location in densely populated economic regions versus sparsely populated economic regions. A causation logic implies that the entrepreneur primarily focuses on a predefined goal and further aims to identify the means to reach that goal. By contrast, an effectuation logic implies that the entrepreneur to a larger extent focuses on the means at hand, which she or he aims at materialising into one or more goals that are not necessarily predefined. The empirical data for the study are based on an investigation and evaluation of Norwegian entrepreneurs in business incubation that are located in many different economic regions of the country. Multilevel regression analyses showed that geographical location in sparsely populated economic regions is associated with a causation logic, whereas a location in densely populated economic regions is associated with an effectuation logic. An implication of the article is that entrepreneurial stakeholders, such as policymakers, incubator managers, public and private partners, and entrepreneurs themselves should be aware of differences in causation and effectuation logics between entrepreneurs located in densely versus sparsely populated economic regions.

KEYWORDS:

• business incubation
• causation and effectuation logics
• economic regions
• policy implications
• regional population density

ORCID

Jarle Aarstad http://orcid.org/0000-0002-6650-6667

Stig-Erik Jakobsen http://orcid.org/0000-0002-1692-6970

Notes

1 Siva is a public enterprise owned by the Norwegian Ministry of Trade, Industry and Fisheries. It facilitates innovation by building, owning and developing infrastructure for industry, start-ups and research environments.

2 The original statements in the electronic questionnaire were in Norwegian and have been translated into English by us.

3 In models not mentioned in this article, we also controlled for a number of other factors but they did not alter any of the statistical conclusions.