The virtue of calculative mindset: A community-based view of entrepreneurial action and its implications to altruistic venturing

Abstract

We develop a community-based model of entrepreneurial action under value-destroying uncertainty (e.g., disasters) to formalize two well-established altruistic motivations— reciprocal opportunity belief (a “calculative” mindset of doing good with expectations of future payback) and compassionate opportunity belief (a “non-calculative” mindset of doing good without expectations of future payback)—and identify which belief and contingencies produce greater community welfare (i.e., value). Three moderating factors are considered: community size, actor’s action desirability, and welfare value increment of the community members. Our analysis shows that when the three moderating factors are large, the reciprocal opportunity belief generally produces greater community welfare than the compassionate opportunity belief; otherwise, the reverse occurs. We conclude that calculative mindset and community size go hand in hand to produce greater network effects through altruistic-venturing actions, which ultimately lead to greater community welfare. Our findings contribute to the emerging literature on the post-disaster venturing by advancing the contingency effects of altruistic motives on entrepreneurial actions to alleviate others’ sufferings and the counter-intuitive benefits of “calculative” mindset. We also stimulate a new conversation to redirect research in entrepreneurship toward the “community” as a viable unit of analysis.