Bruton, Li, and Gautam (2025) published an article in the Journal of Management Studies arguing that management and organization scholarship—especially entrepreneurship research—suffers from a pro-capitalist bias. They claim the field treats American-style capitalism as the default context, focuses almost exclusively on profit maximization, and ignores socialist contexts.
Foss, Klein, Holmes, and Terjesen respond with a Counterpoint in the same journal. They agree that institutions matter. They disagree with the diagnosis, the definitions, and the proposed solution.
The Definitional Problem
Bruton et al., drawing on economist John Roemer, define socialism as “an economic system based on the ethos of cooperative behavior focused on creating as equal a distribution of opportunities and outcomes as possible.” They define capitalism as centered on an “individualist behavioral ethos where each person individually is responsible for their own efforts to earn a living.”
Foss and colleagues argue these are not conventional economic definitions. Conventional definitions center on structural features—ownership of the means of production, resource allocation, the role of the state, the independence of the legal system. Defining systems by ethos rather than structure conflates the institutional architecture of an economy with the motivations of the people within it. It also makes falsification difficult: how does one measure a “socialist ethos,” and at what threshold does a country qualify?
If cooperatives, family firms, mission-driven startups, and Nordic welfare states all fall under “socialism,” the term ceases to discriminate. The counterpoint puts it directly: if the family, church, community group, nonprofit, and mission-driven startup are all socialism, what isn’t?
The Levels-of-Analysis Problem
Socialism and capitalism are typically country-level constructs. Bruton et al. extend them to organizations, communities, and teams. This creates conceptual confusion. A researcher studying how “socialist” contexts affect entrepreneurship cannot tell whether to compare countries with different property rights regimes, organizations with different governance structures, or teams with different motivational profiles. The term does not specify the relevant comparison.
Foss and colleagues propose focusing on specific institutions instead: property rights, market freedom, legal independence, informal norms. These are variables that can be measured, compared, and connected to outcomes.
The Empirical Problem
The claim that entrepreneurship research is monolithically focused on profit maximization is empirically dubious. The field contains extensive work on social entrepreneurship, institutional entrepreneurship, political entrepreneurship, and dual-purpose ventures. Family business research examines firms where socio-emotional wealth preservation often takes precedence over financial returns. The literature on entrepreneurial passion shows that non-financial motivations are central.
There is also a robust literature on entrepreneurship under socialism—in the Soviet Union, post-socialist transitions, and China’s hybrid system. There is work on how institutional uncertainty affects entrepreneurial judgment, on political connections when the state controls economic activity, and on varieties of entrepreneurship across institutional environments.
The counterpoint also questions the Bruton et al. literature review. By focusing on FT50 journals, the review excludes specialized entrepreneurship journals and regional journals that publish research on non-Western contexts.
Foss, Klein, Holmes, and Terjesen respond to Bruton et al.’s (2025) Point essay, which argued that management and organization scholarship—especially entrepreneurship research—suffers from a pro-capitalist bias and ignores socialist contexts. The counterpoint argues that while attention to institutions is warranted, framing the debate through “capitalism” and “socialism” obscures more than it reveals. These terms are politically charged, imprecisely defined, and conflate different levels of analysis.
Bruton et al., drawing on economist John Roemer, define socialism as “an economic system based on the ethos of cooperative behaviour focused on creating as equal a distribution of opportunities and outcomes as possible.” Foss and colleagues argue this is not the conventional definition used by economists. It emphasizes ethos—values and motivations—rather than structural features like ownership, resource allocation, and the role of the state.
Capitalism: Private ownership of capital, coordination through markets, decentralized decision-making. Socialism: Public ownership of the means of production, state direction of resource distribution, legal system not independent of the state.
Capitalism: Individualist behavioral ethos; each person responsible for their own efforts. Socialism: Cooperative ethos focused on equality of opportunity and outcome.
Bruton et al. argue that entrepreneurship research focuses almost exclusively on profit maximization in capitalist settings. Foss and colleagues counter that the field contains extensive work on social entrepreneurship, institutional entrepreneurship, political entrepreneurship, and dual-purpose ventures—all of which examine non-profit-maximizing goals.
The counterpoint questions the Bruton et al. literature review. By focusing on a narrow set of FT50 journals, the review excludes specialized entrepreneurship journals and regional journals that publish research on non-Western contexts. The resulting picture of the field is incomplete in ways that support the essay’s argument.
Socialism and capitalism are typically understood as properties of countries or economic systems. Bruton et al. extend these terms to describe organizational forms and community norms. Under this logic, a cooperative becomes “socialist.” A startup team with a mission becomes “socialist.” A family firm that prioritizes nonfinancial goals becomes “socialist.”
Foss and colleagues are skeptical of the claim that entrepreneurship research is systematically biased toward capitalism. Much of the field’s theoretical foundation comes from economists like Schumpeter, Knight, Mises, and Kirzner—thinkers who emphasized the entrepreneur’s role in disrupting equilibrium, exploiting uncertainty, and discovering opportunities. These are not simply celebrants of market capitalism—they are analysts of a particular kind of economic behavior that can occur in many institutional settings.
Foss and colleagues propose focusing on the specific formal and informal institutions that matter for entrepreneurial activity—rather than grand categories. They call for configurational approaches that examine how combinations of institutions affect organizational forms and outcomes.
The counterpoint reinterprets Bruton et al.’s vague “socialist ethos” as a rigorous behavioral construct: we-intentions—the capacity to take the perspective of a group and choose actions that further group goals. This has implications for team-based entrepreneurship, startup success, and the governance of co-specialized assets.
The Construct Clarity Problem
The terms “capitalism” and “socialism” lack construct clarity. They are defined differently by different scholars, used to refer to different phenomena, and entangled with political identities. The proliferation of terms—social democracy, progressive capitalism, coordinated market economies, varieties of socialism—has made the problem worse.
Foss and colleagues argue that management research is better served by focusing on specific institutions rather than grand categories. Property rights, market freedom, legal independence, informal norms—these constructs can be defined precisely, measured reliably, and compared across contexts.
The Bias
The counterpoint’s authors do not deny that ideology can influence research. They are skeptical of the specific charge that entrepreneurship research is systematically biased toward capitalism. Much of the field’s theoretical foundation comes from economists like Schumpeter, Knight, Mises, and Kirzner—thinkers who analyzed a particular kind of economic behavior that can occur in many institutional settings.
Baumol’s distinction between productive, unproductive, and destructive entrepreneurship is central here. The supply of entrepreneurial talent is relatively constant across societies. What varies is how institutions channel that talent. In some settings, entrepreneurs create new products and processes. In others, they engage in rent-seeking, political maneuvering, or predation.
What the Paper Opens
The counterpoint points toward several research questions. One concerns the microfoundations of institutional effects: how do institutions shape the cognitions and behaviors of entrepreneurs? Another concerns the interaction between formal and informal institutions: the same property rights regime may have different consequences in different cultural contexts. A third concerns normative evaluation: if different institutions produce different patterns of entrepreneurial activity, which patterns are desirable?