Do we understand each other? Toward a simulated empathy theory for entrepreneurship

• Published in: Journal of business venturing Vol. 36; no. 1; p. 106076
• Main Authors: Packard, Mark D., Burnham, Thomas A.
• Format: Journal Article
• Language: English
• Published: Elsevier Inc 01.01.2021; Elsevier B.V
• Subjects: Analysis; Businesspeople; Empathy; Entrepreneurial learning; Entrepreneurship; Imagination; Opportunity evaluation; Opportunity recognition; Empathy; Opportunity recognition; Entrepreneurial learning; Imagination; Opportunity evaluation
• ISSN: 0883-9026; 1873-2003
• DOI: 10.1016/j.jbusvent.2020.106076

Entrepreneurs often face the daunting task of predicting consumer demand before it exists—what consumers will want if and when the entrepreneur might make it available to them. Such alertness and judgment require an entrepreneur's vicarious imagination—the supposition of what a value experience would be like for another—such as empathy. Prevailing theories of empathy, however, are ill-suited for entrepreneurship theory as they are defined as and focused on an emotion-matching process. We propose that empathy be understood instead as a vicarious mental simulation of another's experience that, when accurate, produces similar emotions but also similar experiential knowledge. According to our ‘simulated empathy theory,’ empathy is a rational imagination process, intentional and knowledge-based. We connect this empathy process to contemporary entrepreneurship theory, namely opportunity recognition and evaluation processes. We also revise the concept of empathic accuracy accordingly, and derive therefrom some practical implications regarding how entrepreneurs can increase their empathic accuracy and, thereby, their chances of success. •We develop a new empathy theory based in rational imagination, intentionality, and knowledge.•We establish vicarious imagination (such as empathy) as fundamental to opportunity recognition and evaluation processes.•We elaborate how empathy may result in more or less accurate inferential knowledge about another's experience.