Aexploring the Antecedents of Entrepreneurial Alertness: Interactions between Individual and Environmental Characteristics

ACADEMIC ABSTRACT The current research incorporates individual as well as environmental effects in examining the antecedents of entrepreneurial alertness. Entrepreneurial alertness rests with the asymmetric knowledge that entrepreneurs develop and that others do not. People have different stocks of information because information is generated through people's idiosyncratic life experiences. Therefore, the individual factors examined in the current research are all manifestations of individual life experiences such as human capital, social capital, and social competence. However, the relationships between individual characteristics and alertness are contingent upon the entrepreneurial environment in which opportunities are discovered and the personal turbulence experienced by entrepreneurs. EXECUTIVE SUMMARY Although entrepreneurial alertness has been identified as a major factor influencing the entrepreneurial process, we know relatively little about what constitutes alertness (Yu, 2001). The present research attempts to predict and explain alertness by drawing on the conceptual framework developed by Shane (2003), i.e., by incorporating both individual and environmental characteristics in examining the antecedents of entrepreneurial alertness. According to Kirzner (1997), opportunity exists because different people are aware of different facts, knowledge, or information. Thus, alertness rests with the asymmetric knowledge that entrepreneurs develop and that others do not (Kirzner, 1979; Venkataraman, 1997). People have different stocks of information because information is generated through people's idiosyncratic life experience (Shane, 2003). Therefore, in order to find out why some people identify opportunities and others do not, we need to examine what factors contribute to the development of information asymmetry, which is the focus of the current paper. The individual factors examined in the current research are all manifestations of individual life experiences that contribute to the development of information asymmetry, e.g., human capital, social capital, and social competence. However, Shane (2003) suggested that the tendency of researchers to look at only one part of entrepreneurial process, either the individual centric approach or the environment centric approach, might have accounted for the failure to offer a coherent conceptual framework for entrepreneurship. Thus, the present alertness model also proposes that the relationships between individual characteristics and alertness are contingent upon the environment in which opportunities are discovered: both the overall macro social-economic environment in which new ventures exist; and the specific micro personal context in which idiosyncratic turbulent events happen.