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The Role of Mental Simulations and Counterfactual Thinking in the Opportunity Identification Process

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  • Connie Marie Gaglio

Abstract

The process of identifying, shaping, and pursuing market opportunities is emerging as a focal point in the field of entrepreneurship. Scholarly efforts to date have considered what happens during this process; it is time to turn attention to how and why. This article examines one such “how†question: how do entrepreneurs think and reason such that they identify innovative opportunities? Specifically, the cognitive processes of mental simulation and counterfactual thinking are proposed as mechanisms by which entrepreneurs identify and develop innovative opportunities. Propositions regarding the application of these cognitive processes to opportunity identification are presented and discussed.

Suggested Citation

  • Connie Marie Gaglio, 2004. "The Role of Mental Simulations and Counterfactual Thinking in the Opportunity Identification Process," Entrepreneurship Theory and Practice, , vol. 28(6), pages 533-552, November.
    • Handle: RePEc:sae:entthe:v:28:y:2004:i:6:p:533-552
    DOI: 10.1111/j.1540-6520.2004.00063.x
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    1. Kaish, Stanley & Gilad, Benjamin, 1991. "Characteristics of opportunities search of entrepreneurs versus executives: Sources, interests, general alertness," Journal of Business Venturing, Elsevier, vol. 6(1), pages 45-61, January.
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    3. Gaglio, Connie Marie & Katz, Jerome A, 2001. "The Psychological Basis of Opportunity Identification: Entrepreneurial Alertness," Small Business Economics, Springer, vol. 16(2), pages 95-111, March.
    4. Baron, Robert A., 1998. "Cognitive mechanisms in entrepreneurship: why and when enterpreneurs think differently than other people," Journal of Business Venturing, Elsevier, vol. 13(4), pages 275-294, July.
    5. Dougherty, Michael R. P. & Gettys, Charles F. & Thomas, Rickey P., 1997. "The Role of Mental Simulation in Judgments of Likelihood," Organizational Behavior and Human Decision Processes, Elsevier, vol. 70(2), pages 135-148, May.
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