Prof. Olav Sorenson, Joseph Jacobs Chair in Entrepreneurial Studies, Professor of Strategy, and Faculty Director of the Price Center for Entrepreneurship & Innovation at UCLA Anderson School of Management, shares insights from his research on "The Causal Inference Problem: When Can Managers Use Data to Inform Decisions, and How Can Organization Design Help Them?"

Managers often rely on data to guide strategic decisions, but data alone does not always reveal clear cause-and-effect relationships. This challenge, known as the causal inference problem, arises when correlations in data do not necessarily imply causation. Prof. Olav Sorenson explores when managers can confidently use data to inform decisions and how organizational design can improve their ability to distinguish causation from mere association. By structuring organizations to facilitate controlled experimentation, encourage diverse data sources, and reduce biases, firms can make more reliable, evidence-based decisions, ultimately enhancing strategic outcomes.

Prof. Sorenson’s primary research focuses on economic geography, exploring how entrepreneurship shapes regional growth and competitiveness and why some regions are more supportive of entrepreneurs than others. Reflecting on his journey, he shares: "I was in graduate school in the mid-1990s at Stanford, in Silicon Valley, and it seemed like everybody and their brother was getting involved in a startup. That’s really what got me interested in entrepreneurship and in asking, ‘Why Silicon Valley?’ What made it different from other places?” 

He has highlighted the unexpected consequences of social capital's critical role in entrepreneurial success. In recognition of his groundbreaking research, Prof. Sorenson was honored with the 2018 Global Award for Entrepreneurship Research. Prof. Olav Sorenson is a distinguished scholar with over 100 published papers and nearly 400 research presentations on entrepreneurship, economic geography, and innovation. His work has been featured in top journals like Science, the American Journal of Sociology, and Strategic Management Journal. He currently serves as Faculty Research Director at UCLA Anderson’s Price Center for Entrepreneurship & Innovation, focusing on advancing entrepreneurial research and mentoring student ventures. Previously, he held esteemed positions at Yale, the University of Toronto, London Business School, and the University of Chicago, with visiting appointments at leading institutions worldwide.

Prof. Sorenson earned his bachelor’s degree from Harvard University and his master’s and PhD from Stanford University. He has also been awarded an honorary doctorate from Aalborg University.

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Data-Driven Decision-Making: Prof. Olav Sorenson on Causal Inference & Organization Design

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