Musings on Growth. Dimo Dimov.ERC Understanding Small Business Growth Conference 2015

Musings on growth: Schrodinger’s Cat, Wicked Problems and

Entrepreneurial Opportunities

Dimo Dimov

University of Bath

ERC Conference

Understanding Small Business Growth

11 February 2015

Replication and partitioning

• Multiple observations need to be aggregated

• Observations are, literally, not identical

• Major judgments to be made:

– Which observations are identical? (replication)

– Which observations are different? (partitioning)

• Such decisions are arbitrary and tentative

3 McGrath (1982)

Time

Effort 1

Effort 2

Effort 3

Non-partitioned observation space

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for variance

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Variable 1 Variable 2 Variable 3 Variable 4 Outcome

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for process

Non-partitioned observation space

McMullen and Dimov (2013)

What are firms?

Time

Effort 1

Effort 2

Effort 3

Non-partitioned observation space

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for variance

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Variable 1 Variable 2 Variable 3 Variable 4 Outcome

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for process

Partitioning for variance explanation

McMullen and Dimov (2013)

Two conceptions of time

• A source of noise to the enactment of

regularities

vs.

• Incessant change between past and future

Time

Effort 1

Effort 2

Effort 3

Non-partitioned observation space

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for variance

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Effort 1

Effort 2

Effort 3

Variable 1 Variable 2 Variable 3 Variable 4 Outcome

Time

Effort 1

Effort 2

Effort 3

Observation space partitioned for process

Partitioning for process explanation

McMullen and Dimov (2013)

Partitioning the time dimension

• Public (clock) time

– Continuous vs. discrete (days, months, years)

– Objectively vs. subjectively identical intervals

• Ordered increments of transformation

– Not equal in terms of calendar ‘slots’

– A year is not the same time for every firm (individual)

9 Brumbaugh (1966)

Partitioning for increments of

transformation

10

Junction 1

Junction 2 Junction 3

Junction 4

Junction n

Growth Stasis

Decline

Implications

• After each transformation, the firm (effort)

is not the same any more

• Zoom in on the transformation as focus /

unit of analysis

New logic of explanation

• From nomothetic: searching for regularities

between factors and outcomes

• To generative: specifying mechanisms that can

help reconstruct the process

– Abductive / retroductive inference

– Computational modeling, “a third way of doing

science” (Axelrod, 1997)

Cederman (2005)

Zooming even further

• Each transformation is unique ….

– In content

– In outcomes

• But is there a general structure?

There are no future facts

• The “adjacent possible” changes with each step (Kauffman, 2008)

• The truth of propositions with future time

reference is fractional. Present possibilities

have some ontological status (Brumbaugh, 1966)

Entrepreneurship as design

Engineering, medicine, business, architecture, and

painting are concerned

• not with the necessary

• not with how things are

• but with the contingent,

• but with how they might

be

Simon (1996: xii)

in short, with design.

Transformations as wicked problems

• No definitive formulation

• No stopping rule

• Solutions are not right or wrong (but good or bad)

• Every problem is novel and unique

• Every solution is a “one-shot operation”

• No enumerable set of potential solutions

17

Rittel and Webber (1973)

What next?

• Mission: creation of preferred futures

– Driven by real-world problems

– From ‘independent’ to ‘participant’ observer

– Solution orientation

• Output: solution concepts

– Design propositions

– Pragmatic validity

Van Aken & Romme (2012)