Unsticking the rationality stalemate: Motivated reasoning, reality, and irrationality
Date
2022-08-21Source Title
Journal of Business Venturing Insights
Electronic ISSN
2352-6734
Publisher
Elsevier Inc.
Volume
18
Pages
e00336- 1 - e00336- 8
Language
English
Type
ArticleItem Usage Stats
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Abstract
Rationality is an elusive and increasingly debated concept in entrepreneurship research. We offer a novel conceptualization of rationality based on reasoning motivations. We posit that logical, probabilistic, and heuristic reasoning logics are motivationally rational because the decision-maker attempts to accurately perceive the external world and problem-solve (even if rapidly and approximately). By contrast, when the reasoning ignores an assessment of reality and accuracy in problem-solving and instead is deluded by psychological (e.g., hedonic) urges that prompt self-serving inferences, we categorize such decisions as motivationally irrational. We develop a theoretical account for how motivational irrationality is adaptive under extreme uncertainty as it enables entrepreneurs to dare action when even heuristic reasoning is inconclusive or entirely ineffective.
Keywords
Business venturingIrrationality
Uncertainty
Entrepreneurial decision-making
Entrepreneurial action theory