Social Media and Entrepreneurship: Exploring the Role of Digital Source Selection and Information Literacy

Abstract

Internet-based applications, such as social media, offer potentially effective and efficient vehicles to access, use, and distribute information as well as means to network with other actors. However, for realizing this potential, critical competencies are information and digital literacy. In this chapter we discuss the importance of information literacy (IL) in the context of social media. Information literacy is defined as cognitive skills necessary for using and evaluating information in an educated and effective way. IL is a necessary competence for entrepreneurs in general and specifically for entrepreneurs relying entirely or partially on social media in their entrepreneurial activities. We argue that access and use of information is an important way for entrepreneurs to reduce uncertainty in their entrepreneurial action. Information literacy and information source selection are important to practicing entrepreneurs as most need to access information in order to run their business, information from policy makers, financing institutions, tax authorities, and legal counsel, to name a few. This information is today inherently provided in digital format.