Modeling constrained, systematic search as an instrument of informational economics

Constrained, systematic search works because it is less costly and risky than alternative approaches, assuming we hold constant an entrepreneur's timing and place. Knowing that it works theoretically, justifies field testing it among the poor. Specifically, this chapter examines how the entrepreneurial poor can search systematically with intention for discoveries. It uses consideration sets to impose constraints on how and where to search. A consideration set is a promising group of information channels, which an entrepreneur can select and search based on prior knowledge. To decide how to search the channels, I apply mathematical formalism to illustrate a maximal search sequence. Because there is some probability that a search sequence could continue indefinitely, this chapter determines stopping rules. It argues that entrepreneurial search is more feasible within a consideration set than it is in the rest of the world, including in the world of the poor.