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Overconfidence, Optimism and Entrepreneurship

Author

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  • Indy Bernoster

    (Department of Applied Economics, Erasmus School of Economics, Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands
    Erasmus University Rotterdam Institute for Behavior and Biology (EURIBEB), Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands)

  • Cornelius A. Rietveld

    (Department of Applied Economics, Erasmus School of Economics, Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands
    Erasmus University Rotterdam Institute for Behavior and Biology (EURIBEB), Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands)

  • A. Roy Thurik

    (Department of Applied Economics, Erasmus School of Economics, Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands
    Erasmus University Rotterdam Institute for Behavior and Biology (EURIBEB), Erasmus University Rotterdam, 3062 PA Rotterdam, The Netherlands
    Montpellier Business School, 34080 Montpellier, France)

  • Olivier Torrès

    (Montpellier Business School, 34080 Montpellier, France)

Abstract

Overconfidence is one of the alleged drivers for market entry. However, establishing its effect is challenging and much of the existing entrepreneurship literature confusingly conflates overconfidence with optimism. In the present study, we use validated scales to analyze the relationship between overconfidence and two important aspects of entrepreneurship, while explicitly controlling for optimism. Specifically, we study the role of overconfidence in developing intentions about entering entrepreneurship as well as how overconfidence relates to entrepreneurial orientation. Our findings show that overconfidence is related to intended market entry but not to the market position (entrepreneurial orientation) of the business.

Suggested Citation

  • Indy Bernoster & Cornelius A. Rietveld & A. Roy Thurik & Olivier Torrès, 2018. "Overconfidence, Optimism and Entrepreneurship," Sustainability, MDPI, vol. 10(7), pages 1-14, June.
    • Handle: RePEc:gam:jsusta:v:10:y:2018:i:7:p:2233-:d:155150
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    References listed on IDEAS

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