The role of market and technological knowledge in recognizing entrepreneurial opportunities

Donald S. Siegel, Maija Renko

Research output: Contribution to journalArticlepeer-review

94 Scopus citations


Purpose: Opportunity recognition is an important aspect on entrepreneurship, especially for technology-based ventures. Drawing on Austrian economic theory, recent studies have emphasized the importance of market knowledge in opportunity recognition. Although insightful, these studies do not take account of relationships that exist between different types of knowledge (e.g. technology and market knowledge). The authors aim to address this gap by integrating the Schumpeterian theory of opportunity development with Kirzner's theory of opportunity discovery to examine these relationships. Design/methodology/approach: The data consist of a longitudinal sample of 42 new biotechnology ventures from the USA, Finland, and Sweden. Findings: The paper finds that both market knowledge and technological knowledge (measured as the number of patents) contribute to firms' subsequent recognition of entrepreneurial opportunities. Originality/value: The results show the value and importance of early market knowledge and technological knowledge for subsequent opportunity recognition. The empirical findings are reflected in the light of current research on Kirznerian and Schumpeterian opportunity recognition.

Original languageEnglish (US)
Pages (from-to)797-816
Number of pages20
JournalManagement Decision
Issue number5
StatePublished - May 2012
Externally publishedYes


  • Austrian economics
  • Biotechnology
  • Entrepreneurship
  • Knowledge management
  • Knowledge organizations
  • Opportunity recognition

ASJC Scopus subject areas

  • General Business, Management and Accounting
  • Management Science and Operations Research


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