Batten Institute

Saras D. Sarasvathy



Bio: Saras Sarasvathy is Assistant Professor of Entrepreneurship at the University of Maryland. Her research involves developing the theory of effectuation through in-depth cognitive-science-based studies of entrepreneurial decision making, and exploring its connections with the microeconomics of the pre-firm, macroeconomic value creation, and the philosophy of pragmatism. This pioneering theory posits an alternative to the classic paradigm of rational choice and is being developed and tested by several scholars whose published and working papers are available at The primary outline of the theory was recently published in the Academy of Management Review under the title, “Causation and Effectuation: Towards a Theoretical Shift from Economic Inevitability to Entrepreneurial Contingency,” and further developments are forthcoming in the Journal of Economic Psychology, The Handbook of Strategic Management, and Entrepreneurship Theory and Practice.

Before joining academia, Professor Sarasvathy founded and operated several businesses. One of these was a successful Indian company that manufactured plastic blow-molded and injection-molded products such as lubricant oil containers and gift articles. Her entrepreneurial experience also includes several international ventures.

She earned her Ph.D. from Carnegie Mellon University, where she also received a master’s degree in information systems and the M.S.I.A. (M.B.A. equivalent) with a concentration in entrepreneurship and finance. Her bachelor’s degree with a major in statistics is from the University of Bombay.

Expertise: What Makes Entrepreneurs Entrepreneurial?–entrepreneurship, cognitive science, behavioral economics


Fellowship Focus: The purpose of this Batten Fellowship is for Saras Sarasvathy to collaborate with her faculty host, S. Venkataraman, on research concerning the creation of firms and markets and to serve as an intellectual resource for doctoral students. While in residence, Professor Sarasvathy conducted and participated in doctoral seminars and served as a commentator in the Ruffin Lecture Series on Business Ethics. Her research focuses on in-depth empirical studies using protocol analysis of how expert entrepreneurs make decisions in the pre-firm, using processes of effectuation rather than causation to bring new firms and new markets into existence. She is interested in understanding effectuation in more detail, and particularly in developing its relationship with the microeconomics of the successful pre-firm, new-venture failures in macroeconomic value creation, and the philosophical ideas of pragmatism. She believes that, “Entrepreneurship is economics with imagination. Using economic means, entrepreneurship matches up the products of human creativity with human aspirations. In doing so, it creates markets for products and services that do not yet exist. Just as ‘efficiency’ is the watchword of economics, ‘effectuation’ is the watchword of entrepreneurship.”

As a Fellow, she authored “Entrepreneurship as Economics with Imagination.” She also co-authored “Of Immortal Firms and Mortal Markets: Dissolving ‘The Innovator’s Dilemma,’” “Strategy and Entrepreneurship: Outlines of an Untold Story,” and “Three Views of Entrepreneurial Opportunity.”

Contact Info

Appointment: 1999

Publications & News

Books include:

Effectuation: Elements of Entrepreneurial Enterprise

top of page