Measuring State, Effect, and Response Uncertainty: Theoretical Construct Development and Empirical Validation

An important contribution to the literature on perceived environmental uncertainty (PEU) is Milliken’s distinction between state uncertainty, effect uncertainty, and response uncertainty. However, despite its appealing logic in capturing the types of uncertainty managers may experience as they seek to understand and respond to changes in an organization’s environment, there has been no full and rigorous psychometric development and testing of scales to measure the three constructs. Using a two-phase empirical study, this research seeks to develop and test such scales in terms of dimensionality, reliability, and validity (including nomological validity). The results suggest that managers do make a meaningful distinction between different types of uncertainty, that it is worthwhile measuring all three constructs (as they have differential impacts on outcome variables), and that there are linkages between them. Managerial contributions and implications for future research are also discussed.