Abstract

In recent years, there has been an increasing interest in effectuation as a business start-up practice. This concept is appreciated as a valuable alternative to the prevalent assumption that starting entrepreneurs rely on causal principles. Although previous studies identified a positive relationship between effectuation and firm performance, more recently, literature has emerged that offers contradictory findings. It is argued that causation and effectuation should not be seen as opposed ends of a continuum but are orthogonal in nature. In our research, we empirically test to which extent causation and effectuation contribute to firm success, how both approaches interact and how they jointly influence new venture performance.

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