THEORY BUILDING
Read chapter 3, Theory Building, of the Zikmund et al. text. Answer questions 1-6 in the Questions for Review and Critical Thinking. Please answer questions in detail and support your answers with scholarly research citations where appropriate. Each response should be approximately 125 words using your critical thinking skills.
QUESTIONS FOR REVIEW AND CRITICAL THINKING/ANSWERS (solution manual) FOR REFERENCE ONLY.
THEORY BUILDING
1. What are some theories offered to explain aspects of your field of business?
Students’ responses will vary depending on their major. Some management theories include Contingency Theory and Balanced Score Card. Opinion Pricing Theory is used in finance. Theory of Reasoned Action and Dual-coding Theory are used in marketing, and economic theories include Demand Theory and Balance of Payment Theory.
THEORY BUILDING
2. How do propositions and hypotheses differ?
Propositions are statements concerned with the relationships among concepts. They explain the logical linkage among certain concepts by asserting a universal connection between concepts. A hypothesis is a forma statement explaining some outcome. In its simplest form, a hypothesis is a guess. A hypothesis is a proposition that is empirically testable. So when stating a hypothesis, it should be written in a manner that can be supported or shown to be wrong through an empirical test.
3. Reflect on your own social network. How are the nodes in your social network linked? What capital do you gain from your social network?
4. How do concepts differ from variables?
A concept (or construct) is a generalized idea about a class of objects, attributes, occurrences, or processes that has been given a name and is the building blocks of theory. Variables are anything that may assume different numerical values and are the empirical assessment of a concept.
5. What does the statement “There is nothing so practical as a good theory” mean? Do you agree with this statement?
Theories allow us to generalize beyond individual facts or isolated situations and provide a framework that can guide managerial strategy by providing insights into general rules of behavior. A good theory allows us to generalize beyond individual facts so that general patterns may be understood and predicted. For this reason it is often said there is nothing so practical as a good theory.
5. The seventeenth-century Dutch philosopher Benedict Spinoza said, “If the facts conflict with a theory, either the theory must be changed or the facts.” What is the practical meaning of this statement?
The two purposes of theory are understanding and predicting. Thus a theory enables us to predict the behavior or characteristics of one phenomenon from the knowledge of another phenomenon. To predict phenomena, we must have an explanation of why variables behavior as they do. Theories provide these explanations. In most scientific situations there are alternative theories to explain certain phenomena. To determine which is the better theory, researchers make observations or gather empirical data to verify the theories. If the facts conflict with a theory, most students will likely say that the theory must be changed because we cannot change facts. While that may be true, some “facts” are actually more abstract than others, and how we operationalize our variables, which is the process of identifying the actual measurement scales to assess the variables of interest, might need to be changed. This is especially true in behavioral sciences because the “facts” are not as concrete as those used to test theories in the physical sciences.
