Innovative Entrepreneurship: Testing the Theory of Environmental Determinism (original) (raw)

It is often pointed out that like many areas of social science research, entrepreneurship research lacks direction for want of an appropriate paradigm. While it is true that researchers often fail to explicitly state the paradigms under which they conduct their investigations, it cannot be denied that most studies follow the assumptions of an implicit paradigm. Two such paradigms, which are proposed as antithetical to each other are the Strategic Choice Paradigm and the Population Ecology (Environmental Determinism) Paradigm. The former explains the phenomenon of entrepreneurship by the strategic choices of the individual, while the latter by the process of environmental selection. This paper details an attempt to test the influence of environmental factors on the emergence of innovative enterprises. A sample of 157 enterprises was classified into high, moderate, and low innovation groups, which were further classified according to the regions, time of startup, and industry. Thus there were three sets of two-way classifications, which enabled the testing of the proportions of innovative enterprises under different environmental conditions compared to the proportions in the total sample using Chi-square tests. The Chi-squares were not found to be significant, indicating that there was no significant difference among various environmental conditions in terms of the emergence of innovative enterprises. The theory of environmental determinism, therefore, is not supported. This finding would imply, among other things, that training and development of individuals is more effective in bringing about innovative entrepreneurial/managerial performance than the creation of conducive environment and facilities