The Double-Edged Sword Effect of Entrepreneurs’ Critical Thinking on Venture Novelty

Venture novelty enables startups to overcome entry barriers and establish differentiated competitive advantages. However, research examining its antecedents from an epistemic control perspective remains limited. Drawing on survey data from 230 entrepreneurs and employing structural equation modeling (SEM) and fuzzy-set qualitative comparative analysis (fsQCA), this study investigates how entrepreneurs’ critical thinking influences venture novelty. The findings reveal a dual effect. On the one hand, critical thinking promotes venture novelty by fostering interactive learning, which facilitates the integration of heterogeneous information and the refinement of entrepreneurial opportunity insights. On the other hand, critical thinking increases cognitive depletion, thereby constraining the cognitive resources available for innovative activities. Furthermore, imagination moderates these relationships by strengthening the positive effect of interactive learning while attenuating the negative impact of cognitive depletion. FsQCA results further identify four configurational pathways to high venture novelty. This study contributes to the literature by stating both the enabling and constraining mechanisms of entrepreneurs’ critical thinking, clarifying its dual role in epistemic control, and providing configurational evidence regarding the role of imagination in fostering entrepreneurial innovation.