Microfoundational Explanation: A Complementary Model for Entrepreneurship in Family Business

Improving explanation has always been a crucial challenge for scholars of any social science, particularly in areas of study, such as entrepreneurship and family business, whose progress depends on the generation of both scientific and usable knowledge. Recently, a microfoundational perspective has been recommended as a promising avenue for achieving a better understanding of entrepreneurial and family business phenomena. In this paper we assess such claim by contrasting microfoundational explanation with the dominant models in the field, namely variance and process approaches. We claim that microfoundational explanation can help progress in the field when used as an adjunct to variance and process models. We defend our claim first by advancing a complementarity thesis according to which the microfoundational model addresses causal questions that are distinct from, and supplemental to, the questions addressed by variance and process models. Second, we argue that microfoundational explanation contributes scientific and usable knowledge by pursuing goals that obey both practical and epistemic interests, namely intervening, contextualizing, sequencing, and strategizing.