How experience shapes the subjective evaluation of business opportunities

The purpose of this paper is to build on a set of recent theoretical studies investigating the role of subjective insights and judgments in the resource-based view and to extend this important line of inquiry by offering a detailed assessment of how agents' knowledge and experience endowments systematically shape their subjective evaluations of business opportunities, and thus the firm's growth options. Our empirical analysis is based on a unique data set that combines experimental conjoint data and survey data obtained from 141 individuals. Our results not only provide evidence of heterogeneity in opportunity evaluations by individuals with different types of experience endowments (marketing, technology, management) but also demonstrate persistence of this heterogeneity. The findings provide a number of novel implications for strategy and entrepreneurship research.