Entrepreneurial judgment

This chapter explores a series of central themes in contemporary Austrian entrepreneurship research that we group under the heading of entrepreneurial judgment. These themes are crucial elements in what is now known as the judgment-based approach to entrepreneurship (JBA). The JBA has a distinguished pedigree in Austrian work and has been growing substantially in recent years both there and in other areas of social science and management research. We first outline the history and major themes of the JBA, including decision-making under uncertainty, the ownership and use of heterogeneous capital assets, the delegation of authority within the firm and its implications for organization, and the social function of the profit and loss test. We then discuss several current trends in the judgment literature and explore some open questions and debates that continue to animate this body of research. Following this, we discuss the use of the JBA in fields of management beyond entrepreneurship; the relation of judgment to institutions; and the relation of judgment to economic policy.