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The literature review in a business thesis: theory, sources, constructs

In an empirical business thesis the literature review builds the theoretical framework, derives the hypotheses or propositions, and defines the constructs the empirical part will measure. The page covers that chain, which sources a business supervisor gives weight to, what guides from German, Lithuanian and Swedish business schools ask for, and how to check your draft.

Esmond doesn't open your sources. From within your field, it points out where your use of them leaves a claim unsupported, where you cite a source in two conflicting ways, and other blind spots.

What the literature review does in a business thesis

The Chair in International Management and Governance at the University of Bremen starts from a plain definition: “In very basic terms, the literature review is a collection of prior academic studies, their findings and a critical discussion.” In a business thesis with its own data, that discussion leads somewhere specific. The Department of Management at Freie Universität Berlin describes the theory chapter of an empirical thesis this way: “This chapter serves as a detailed presentation and justification of your research question or hypotheses.”

So a supervisor reads the review as the first half of an argument. The second half is the method and the results. A review that describes the field well but stops before the hypotheses leaves the reader to guess where they came from. For the place of the review in the whole thesis, see the page on the master's thesis in business administration; for a practice-oriented report, the page on the MBA capstone.

A hypothetical example of a commentYour review defines employer attractiveness with three dimensions, but the survey in chapter four measures only two of them. Where does the third dimension go?

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From theory to conceptual model to hypotheses

Bremen's guide puts the step in one sentence: “Based on your theoretical framework, you will have to formulate hypotheses (measurable, testable) or propositions (contestable, broader) about what you expect reality to be like given your previous literature review.” The thesis proposal form of the Chair of Sustainable Business at the University of Mannheim asks the same question early: “Which theories will you use to derive your hypothesis?”

In practice each hypothesis needs a mechanism, and the mechanism comes from a theory. A strategy thesis might use the resource-based view to argue why a capability should raise performance; an HRM thesis might use social exchange theory; a family business thesis might draw on agency theory and on socioemotional wealth reasoning, which can predict opposite directions for the same relation, for example between family ownership and R&D investment. When two theories predict different signs, the review should say which one the thesis follows and why, or frame competing hypotheses.

The conceptual model is the drawing of that argument: boxes for constructs, arrows for the hypothesized relations. A moderator changes the strength or direction of a relation; a mediator carries the effect from one construct to another. Each arrow in the model should be argued in the text, and each argued relation should be in the model. A qualitative thesis works with propositions or a frame of reference instead, but the same link between reading and expectation applies.

Academic and practitioner sources

Business is a field where practitioners publish a lot: consultancy surveys, trade press, company reports, industry associations. The guides quoted here give them a limited role. Freie Universität Berlin asks students to rank their reading: “Generally, you should always prefer higher quality sources (e.g. those with a higher journal ranking, see below, or books from established scientific publishers) to those of lower quality.” Bremen warns: “Be careful not to use resources that have no peer review or a political tendency.”

Practitioner material has a place in the motivation. Mannheim's proposal questions start with “Why is the topic of interest? (Here you can use current statistics or news reports)”, and University West in Sweden, in guidelines from 2013, says of the background section: “The background may be relatively broad and may contain material from newspapers, textbooks, scholarly articles, etc.” The same guidelines raise the bar for the master's level: “The scholarly weight in the sources of the thesis must be higher where e.g. the contribution of relevant articles from scholarly journals is concerned.”

Journal quality lists help with that weight. Departments use different ones: the VHB rating in Germany, the Finnish Publication Forum (JUFO) levels, the Norwegian register of scientific journals with its levels 1 and 2, or the Financial Times list of 50 journals. Which list counts, if any, is a question for your department.

SourceWhere it can work in the reviewWhat a reader asks
Peer-reviewed journal articlesTheory, earlier findings, measurement scalesAre the main studies on this relation here, and are they recent enough?
Meta-analytic studies and systematic reviewsThe state of evidence on a relationDoes the review use them, or cite single studies that disagree with them?
Practitioner journalsConcepts that practice uses, early signals of a trendIs the article used for an idea or as evidence for a causal claim?
Consultancy reports and surveysMotivation: how widespread a practice or problem isWho was surveyed, how, and by whom was it paid for?
Trade press and newsContext, examples, timingIs it doing more than setting the scene?
Company documentsData about the case or firmIs it treated as data, not as support for a theory?

Constructs and their measurement

The review defines the constructs; the methodology chapter turns them into measures. A supervisor reads the two side by side. ISM University of Management and Economics in Lithuania, for a Business Sustainability Management thesis done by two students together, asks that both be able to “defend any part of the thesis, such as the literature review, data measurement scales, questionnaires, choice of sampling, data collection process and data analysis results”. A supervisor or the assessors can ask about the link between the definition in the review and the scale in the questionnaire.

Typical gaps: a construct defined with several dimensions and measured with a one-dimensional scale; firm performance discussed through studies on return on assets and measured as managers' perceived performance; a scale adapted from a study at the level of individual employees and used at the level of the firm; in family business research, family involvement defined through ownership, management and generations and measured only as an ownership share. None of these is wrong by itself. Each needs a sentence that explains the choice and its limits.

What a business supervisor reads for in the review

For how to state the gap itself, see the page on the research gap.

In the reviewWhat the reader checks
The theories usedDoes each hypothesis rest on one of them, with the mechanism spelled out?
The conceptual modelDoes every arrow have an argument in the text, and every argued relation an arrow?
Earlier findingsAre contradicting results reported, and does the hypothesis take a side for a stated reason?
The gapIs it a gap in the academic literature, or only in the practitioner debate?
Construct definitionsDo they match the scales and variables in the empirical part?
SourcesIs the core argument carried by peer-reviewed work, and are recent studies included?

Weak passages in a business literature review

These fragments are made up. None of them comes from a real thesis.

Check your own review before your supervisor sees it

What Esmond reads in a business thesis literature review

Esmond evaluates every assignment before you submit. It never writes it.

Esmond is an AI tool that doesn't write for you. If your course doesn't allow any AI tools, don't use Esmond for that work. If you're unsure, ask your instructor or advisor.

Esmond reads your review from within business and management research and can flag, in the text you upload, factual errors, inconsistencies and blind spots: a hypothesis without a mechanism, an arrow in the model that the text never argues, a claim of consistent findings that the studies the review itself cites don't support, a consultancy figure used as support for a hypothesis, or a construct defined in one way and measured in another. See the sample report and how Esmond works; for other chapters, start from thesis chapter feedback.

Esmond reads what you upload. If the file holds the whole draft, it can set this chapter against the others; if it holds one chapter, the review stays within that chapter and may raise a point that another chapter already answers.

Esmond doesn't search the literature for you, doesn't rank journals, and doesn't test your model or rerun your analysis. You decide what to change.

Frequently asked questions

What is a literature review in business research?

A critical discussion of earlier academic studies on your question that leads to the framework of your own study: the theories you use, the constructs you define, and, in a quantitative thesis, the hypotheses you test. In a qualitative thesis it leads to propositions or a frame of reference.

Can I use consultancy reports or news articles in a business thesis literature review?

The guides quoted here give them a place in the background and motivation, for example Mannheim's proposal form and University West's guidelines, and ask for scholarly sources to carry the argument. Check what your department accepts.

How many sources should a business thesis literature review have?

No general number exists. Some programs set one: ISM University of Management and Economics, for its Business Sustainability Management thesis, asks for at least 50 academic peer-reviewed sources in the references. Your program's guide decides.

What is the difference between a literature review and a theoretical framework?

The review discusses what earlier studies found. The framework selects the theories and constructs your study uses and shows how they relate, often as a conceptual model. The framework can be the last part of the review chapter or a chapter of its own.

Do I need hypotheses in a business thesis?

In a quantitative thesis that tests relations, the guides quoted here expect hypotheses derived from the review. A qualitative or exploratory thesis works with research questions or propositions instead. Bremen's guide, for example, distinguishes testable hypotheses from broader propositions.

Further reading

Sources

Read on November 8, 2026.

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