Overconfidence and risk perceptions: do they really matter for venture creation decisions?

Robinson, Anthony; Marino, Louis

doi:10.1007/s11365-013-0277-0

Cited by 74 publications

(82 citation statements)

References 69 publications

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“…The study's findings are in line with the notion that nascent and new business entrepreneurs model entrepreneurs' stories they read in the media and apply what worked for them (Aldrich & Yang 2014;Baron & Ensley 2006;Rae 2005). Also, because nascent entrepreneurs have self-confidence in their own skills, they try out things by themselves and do not seek help (Markman & Baron 2003;Robinson & Marino 2015). This is why some of them read the success stories of other entrepreneurs.…”

Section: Hypothesis 6b: Reading Bookssupporting

confidence: 79%

Human capital investments as sources of skills: An analysis at different entrepreneurship phases

Mamabolo

Myres

Kele

2017

SAJESBM

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Background: Entrepreneurs need entrepreneurial skills to run their businesses. Skills can come from various sources, and the usage of the sources of skills can vary according to the different entrepreneurship phases.Aim: Adopting a human capital theory perspective, this study determined the specific human capital investments as sources of skills needed by entrepreneurs across the different entrepreneurship phases. The sources of skills included work experience, formal education, entrepreneurship education and entrepreneurship experience.Setting: Entrepreneurs at the different entrepreneurship phases which are nascent (entrepreneurs with ventures less than 3 months in existence), new business (entrepreneurs with ventures with more than 3 months but less than 3.5 years in existence) and established business (entrepreneurs with ventures more than 3.5 years in existence).Method: The study employed a survey research design. An online questionnaire was used to collect the data.Results: The results show that the sources of skills are used differently across the entrepreneurship phases. As entrepreneurs start businesses, in the nascent phase, the use of human capital investments (especially formal education) as a source of skills declines, thus creating a need to acquire more entrepreneurship-specific investments. In addition to acquiring skills from human capital investments, entrepreneurs learn skills from people in their social networks and self-taught skills which are used differently across the different entrepreneurship phases.Conclusion: The findings indicate that the human capital investments are dynamic and change over time as the entrepreneurship phases unfold. Because there are different sources of skills for each entrepreneurship phase, entrepreneurs need to be treated according to their phases.

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Section: Hypothesis 6b: Reading Bookssupporting

confidence: 79%

Human capital investments as sources of skills: An analysis at different entrepreneurship phases

Mamabolo

Myres

Kele

2017

SAJESBM

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“…Hormiga and Bolivar-Cruz (2014) show that among immigrants in Spain, the perception of risk influences the decision to become an entrepreneur. Robinson and Marino (2013) argue that overconfidence can deteriorate firm performance. They show that risk perception is an important moderator for overconfidence, thus making an indirect positive contribution to entrepreneurial outcomes.…”

Section: Related Literaturementioning

confidence: 99%

Entrepreneurship, risk perception and firm performance

Boermans

Willebrands

2017

IJESB

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Risk attitudes of entrepreneurs are well-established drivers of business performance. Most empirical studies in this field only take into account risk propensity, leaving out the complementary concept of risk perception. Using data on 611 entrepreneurs from Tanzania, we show that risk perception is positively associated with business performance. In addition, we classify the entrepreneurs in four different groups based on their risk profile. The results show that the worst performing entrepreneurs are those with low risk perception and high risk propensity.

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“…However, entrepreneurial research doesn't make such assumptions. Confidence or overconfidence of the entrepreneur will help to drive important entrepreneurial activities (Robinson and Marino, 2013). Making abundant those resources to sustain a startup is of critical importance for the potential entrepreneur's level of confidence.…”

Section: Discussionmentioning

confidence: 99%

“…As possibilities for loss , they are negatively associated with the chance for gains (Janney and Dess, 2006). These chances for loss are stark contrasts to chances for favorable outcomes (Robinson and Marino, 2013). Potential entrepreneurs must weigh these possibilities when making entrepreneurial decisions.…”

Section: Perceived Local Risks and Perceived Opportunitymentioning

confidence: 99%

How Perceptions of the Global Economic Slowdown Impact and Local Risks Adversely Affect Perceived Opportunities and Subsequent Startup Activities

Robinson¹,

Grayson²

2014

BMR

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The Great Recession which began in 2008 is the worst global recession since World War II. Arguably, this global economic slowdown began with failures in financial regulation and housing policies. Undisputable are the adverse effects of this global financial crisis. Worldwide wealth was destroyed. Unemployment rose precipitously. Small businesses and medium businesses found it difficult to access funding sources. Large businesses reduced investments. However, little has been empirically established regarding the effects of the global slowdown on entrepreneurial startups. This study applies a cognitive lens to examine the effects of the perceived global slowdown impact along with the effects of perceived local risks on startup activities when mediated by perceived opportunities. All hypothesized relationships are found to be significant. Equally important, perceived opportunity is found to fully mediate the relationship between perceived global slowdown impact and startup activity. It is also found to partially mediate the relationship between perceived local risks and startup activities. Hence, this manuscript establishes the basis for beginning to understand how the perceived global slowdown impact is relevant for global startup activity.

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Overconfidence and risk perceptions: do they really matter for venture creation decisions?

Cited by 74 publications

References 69 publications

Human capital investments as sources of skills: An analysis at different entrepreneurship phases

Human capital investments as sources of skills: An analysis at different entrepreneurship phases

Entrepreneurship, risk perception and firm performance

How Perceptions of the Global Economic Slowdown Impact and Local Risks Adversely Affect Perceived Opportunities and Subsequent Startup Activities

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