INPUT-OUTPUT KNOWLEDGE THEORY: POTENTIAL AND APPLICATION AS A THEORY OF ENTREPRENEURIAL COGNITION (SUMMARY)

2013

Elaine C Rideout

David Birch, author of the seminal research implying the enormity of the contribution of the small business sector to the overall economy, once said, “If you want to teach people to be entrepreneurs, you can’t.” (Aronsson, 2004). Nonetheless, millions of dollars are spent every year on programs, courses, centers, workshops, etc., based on the assumption that entrepreneurship educators can teach the cognitive mindsets and skillsets that in turn generate entrepreneurship, new companies, and new jobs. This controlled study is grounded in psychosocial theories of entrepreneurial cognition. Tacit knowledge, “expert” scripts, (Mitchell et al., 2002), cognitive “alertness” (Kirzner, 1985), and satisficing on inputs under conditions of uncertainty (Sarasvathy, 2001, Baker, 2005) are all inputspecific cognitive strategies. The study applied and tested an overarching theory, Input-Output (IO) Knowledge Theory, to help make sense of these disparate views. IO Theory has recently been applied by electronics and systems theory researchers where controlling dynamic systems under conditions of uncertainty are of paramount importance. IO Systems research has found that when uncertainty is high and factual/structural knowledge is low or unavailable, IO cognitive strategies (manipulating the number of inputs if that’s the only strategy available, for example) to control dynamic systems outcomes can be as effective performance-wise as when structural information about a system is known or knowable.

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