This paper examines how the change from an assumption of pure self-interest to an assumption of bounded self-interest alters basic propositions regarding the way entrepreneurs select, negotiate with and manage relationships with their initial set of stakeholders. Although a purely economic approach would focus on material cost as the sole consideration when conducting these activities, we argue that non-material factors such as reciprocity and fairness are potent forces during the initial resource acquisition process. We explain that non-material considerations are accounted for in negotiations with stakeholders and positive reciprocity is encouraged through openly sharing information with stakeholders about the value of their contributions to the venture. Furthermore, we expect that entrepreneurs do and should seek stakeholders with expectations about future outcomes that are complementary to their own. This analysis provides a new perspective on the creation of entrepreneurial rent that promises to provide an enhanced understanding of the resource acquisition process as well as guidance to practitioners and researchers.

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Post-print Chapter



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Publisher Statement

Copyright © 2011 Edward Elgar Publishing. This book chapter first appeared in Stakeholder Theory: Impact and Prospects, edited by Robert A. Phillips, 193-211, Cheltenham, UK: Edward Elgar Publishing, 2011.

The definitive version is available at: Edward Elgar Publishing.

Full Citation:

Bosse, Douglas A. and Jeffrey S. Harrison. "Stakeholders, Entrepreneurial Rent and Bounded Self-Interest." In Stakeholder Theory: Impact and Prospects, edited by Robert A. Phillips, 193-211. Cheltenham, UK: Edward Elgar Publishing, 2011.