Effectuation has become the basis for educating entrepreneurs and managers. Derived from cognitive and behavioral economic studies of expert entrepreneurs, effectuation shows how to cocreate value in highly uncertain situations. The framework of effectuation consists in techniques that minimize...

We use a two period model to analyze the contractual relationship between entrepreneurs and venture capitalists in an open regional economy. First, we describe the first best investment contract, we study the second best investment contract in the presence of private information, and then we...

We analyze the activities of an entrepreneur who must, at each date, decide whether to search for a new production technique or to produce output with an extant technique. Our analysis leads to four results. First, we show that if our entrepreneur rejects a particular production technique at a...

We use a two period model to analyze the contractual relationship between entrepreneurs and venture capitalists in an open regional economy. First, we describe the first best investment contract, we study the second best investment contract in the presence of private information, and then we...