A Network-Based Approach on Opportunity Recognition

Posted: 18 Nov 2009

See all articles by Pia Arenius

Pia Arenius

Turku School of Economics

Dirk De Clerq

Brock University - Faculty of Business

Date Written: 2005

Abstract

This study investigates the influence of networkperspectives on entrepreneurial opportunity recognition, based on twofactors:the cohesiveness of current networks and the accessibility toopportunity recognition and human capital through network contacts.Theprevious literature regarding network cohesiveness, human capital, education,and work status is presented, and, based on this research, three hypotheses arecreated.The data for the study were collected from the 2002 GlobalEntrepreneurship Monitor (GEM) study. Additional telephone interviewswere conducted in Belgium (n=3,102) and Finland (n=1,434). The results indicate that individuals living in well-populated areas weremore likely to recognize opportunities compared to individuals in rural,less-populated areas.These effects were much stronger among Finnishparticipants.Additionally, an individual's education level was the onlyhuman capital factor found to positively impact the chance of recognizingbusiness opportunities.Possible explanations for these findings, in lightof social network theory,are discussed.(AKP)

Keywords: U.S. Census International Database, Rural areas, Social capital, Social networks, Urban areas, Access to information, Educational background, Employment, Global Entrepreneurship Monitor (GEM), Human capital, Information acquisition, Opportunity recognition

Suggested Citation

Arenius, Pia and De Clercq, Dirk, A Network-Based Approach on Opportunity Recognition (2005). Small Business Economics, Vol. 24, Issue 3, p. 249-265 2005. Available at SSRN: https://ssrn.com/abstract=1508270

Pia Arenius (Contact Author)

Turku School of Economics ( email )

Rehtorinpellonkatu 3
TURKU, FI-20500
Finland

Dirk De Clercq

Brock University - Faculty of Business ( email )

St. Catharines, Ontario L2S 3A1
Canada

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