Abstract

How does the tendency of entrepreneurs to engage in innovation relate to their structural and cultural embeddedness? Using micro‐data on entrepreneurial teams and the organizational innovations they attempt to develop, this article presents a predictive model of creative action to address this question. Capacity for creative action is seen to be a function of the ability of entrepreneurs to (i) obtain non‐redundant information from their social networks; (ii) avoid pressures for conformity; and (iii) sustain trust in developing novel—and potentially profitable—innovations. Probit analyses of over 700 organizational startups suggest that these mechanisms exercise effects on innovation via the network ties and enculturation of entrepreneurs.

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