EXECUTIVE SUMMARY

Should attempts at opportunity discovery be governed through markets or firms? We argue that many opportunities boil down to valuable problem-solution pairings, and that opportunity discovery relates to deliberate search or indeliberate recognition over this solution space. As problem complexity increases, directional search via trial-and-error provides fewer benefits, and heuristic search via theorizing becomes more useful. Heuristic search, however, requires knowledge sharing that is plagued by a knowledge appropriation hazard and a strategic knowledge accumulation hazard. Given the complexity of the associated problem, markets, authority-based hierarchy, and consensus-based hierarchy have differential effects on the efficiency of opportunity discovery