1.3 - Are Entrepreneurs Special People? Flashcards
What is the main focus of Trait Theory in entrepreneurship?
Trait theory aims to understand entrepreneurship by focusing on the entrepreneur as an individual. It posits that certain stable psychological and/or genetic traits such as Need for Achievement (NAch), Internal Locus of Control, and Risk-taking Propensity make an individual more likely to be entrepreneurial.
What conclusion did Gartner’s 1988 paper reach regarding Trait Theory?
Gartner’s 1988 paper questioned the validity of trait theory, finding no compelling evidence to support claims that specific entrepreneurial traits exist. Gartner suggested that the focus should be on the entrepreneurial process rather than on the individual entrepreneur.
What do Blanchflower and Oswald claim is the key factor in becoming an entrepreneur?
Blanchflower and Oswald concluded that psychological traits play no significant role in becoming an entrepreneur. Instead, they argue that access to finance is the determining factor.
How do Rauch and Frese view the role of personality in entrepreneurship?
Rauch and Frese argued that while personality traits are correlated with entrepreneurship, their effects are relatively small when compared to other influences.
What did Nicolaou and colleagues discover about the role of genetics in entrepreneurship?
Nicolaou and colleagues found a genetic basis for entrepreneurial tendencies. They discovered that identical twins are more likely to be self-employed, suggesting that genetics play a role in entrepreneurial behavior.
What did Greene et al. find about the role of testosterone levels in entrepreneurship?
Greene et al. found that higher testosterone levels are associated with self-employment. However, they noted that this relationship might be context-specific and should not be universally applied.
What are cognitive biases, and how do they differ from traits?
Cognitive biases are mental shortcuts or patterns of thinking that are less rigid than traits and are developed based on past experiences. Unlike traits, which are thought to be stable and inherent, cognitive biases can change over time.
How do cognitive biases affect the decision-making processes of entrepreneurs?
Entrepreneurs who exhibit cognitive biases such as over-optimism, tolerance of ambiguity, and hindsight bias tend to overestimate the likelihood of success and downplay the chances of failure. These biases affect their decision-making processes, often making them take risks that they perceive as lower than they actually are.
Are entrepreneurs necessarily greater risk-takers than the average person?
No, entrepreneurs are not necessarily greater risk-takers than the average person. However, due to cognitive biases like over-optimism, they often overestimate the likelihood of success and downplay the chances of failure, which might make them appear to be taking greater risks.
