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Business Research Methods: Theory Building

The document discusses theory building and the scientific method. It defines concepts, propositions, and variables, and explains deductive and inductive reasoning. It also describes the process of developing increasingly abstract theories and using empirical evidence to predict future realities.

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Surriya Murtaza
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60 views

Business Research Methods: Theory Building

The document discusses theory building and the scientific method. It defines concepts, propositions, and variables, and explains deductive and inductive reasoning. It also describes the process of developing increasingly abstract theories and using empirical evidence to predict future realities.

Uploaded by

Surriya Murtaza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Business

Research Methods

William G. Zikmund

Chapter 3:
Theory Building
Chapter 3:
Theory Building
1. Definition of Theory
2. Levels of Reality
2.1. Constracts
2.2. Propositions
3. Scientific Method
3.1. Deductive Reasoning
3.2. Inductive Reasoning
1. Definition of Theory
A coherent set of general propositions used as
principles of explanation of the apparent
relationships of certain observed
phenomena.

Two Purposes of Theory:


• Understanding
• Prediction
Theories
Theories are nets cast to catch what we call
“the world”: to rationalize, to explain, and
to master it. We endeavor to make the mesh
ever finer and finer.
Karl R. Popper
2. Levels of Reality
• Abstract level (concepts & propositions): in
theory development, the level of knowledge
expressing a concept that exists only as an
idea or a quality apart from an object.

• Empirical level (variables & hypotheses):


level of knowledge reflecting that which is
verifiable by experience or observation.
2.1. Concept (or Construct)
• A generalized idea about a class of objects,
attributes, occurrences, or processes that has
been given a name
• Building blocks that abstract reality
• “leadership,” “productivity,” and “morale”
• “gross national product,” “asset,” and
“inflation”
Concepts are Abstractions of
Reality
Abstract CONCEPTS
Level

Empirical OBSERVATION OF OBJECTS


Level AND EVENTS (REALITY)
A Ladder Of Abstraction
For Concepts

Increasingly more abstract


Vegetation

Fruit

Banana

Reality
A Ladder Of Abstraction
For Concepts
Asset

Increasingly more abstract


Plant
Machinery

Punch Press

Reality
Theory Building: A Process Of
Increasing Abstraction

Increasingly more abstract


Theories

Propositions

Concepts

Observation of objects
and events (reality )
2.2. Propositions
• Propositions are statements concerned with
the relationships among concepts.

• A hypothesis is a proposition that is


empirically testable. It is an empirical
statement concerned with the relationship
among variables.
• A variable is anything that may assume
different numerical values.
Proposition at Abstract Level

Concept A Concept B
(Reinforcement) (Habits)

Hypothesis at Empirical Level

Dollar bonus for


sales volume Always makes
over quota four sales calls
a day
3. Scientific Method
The use of a set of prescribed procedures for
establishing and connecting theoretical
statements about events and for predicting
events yet unknown.
Empirical Evidence help us predict future reality through
abstract concepts

1–14
© 2002 Southwestern College Publishing. All rights reserved.
3.1. Deductive Reasoning
• The logical process of deriving a conclusion
from a known premise or something known
to be true.
– We know that all managers are human beings.
– If we also know that John Smith is a manager,
– then we can deduce that John Smith is a human
being.
3.2. Inductive Reasoning
• The logical process of establishing a
general proposition on the basis of
observation of particular facts.
– All managers that have ever been seen are
human beings;
– therefore all managers are human beings.
The Scientific Method:
An Overview

Assess Formulate Statement


Design
relevant concepts & of
research
existing Propositions Hypotheses
knowledge

Acquire Analyze & Provide


empirical evaluate explanation-
data data state new
problem

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