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How Do Risk Attitudes Differ within the Group of Entrepreneurs? The Role of Motivation and Procedural Utility

Author

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  • Joern Block
  • Philipp Sandner
  • Frank Spiegel

Abstract

Starting a business involves risk and, thus, requires a risk‐taking attitude. The concept of risk and entrepreneurship has been widely discussed in the entrepreneurship literature; most studies compare entrepreneurs with nonentrepreneurs such as managers or bankers. So far, little research exists on the risk attitudes of the different types of entrepreneurs—those who pursue a new business because of opportunity and those who do so through necessity. This study aims to fill this gap. Our particular focus is on individuals' motivations to start their businesses and the nonmonetary returns from entrepreneurship. The results show that opportunity entrepreneurs are more willing to take risks than necessity entrepreneurs. In addition, those who are motivated by creativity are more risk tolerant than other entrepreneurs. The study contributes to the literature about both risk attitudes of entrepreneurs and necessity and opportunity entrepreneurship.

Suggested Citation

  • Joern Block & Philipp Sandner & Frank Spiegel, 2015. "How Do Risk Attitudes Differ within the Group of Entrepreneurs? The Role of Motivation and Procedural Utility," Journal of Small Business Management, Taylor & Francis Journals, vol. 53(1), pages 183-206, January.
    • Handle: RePEc:taf:ujbmxx:v:53:y:2015:i:1:p:183-206
    DOI: 10.1111/jsbm.12060
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    Cited by:

    1. Dr Jason Mwanza & Nothando Tshuma, 2023. "Mitigating Business Risk in Manufacturing SMEs: A nexus between informal and formal business risk management: A case of Bulawayo, Zimbabwe," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(1), pages 1107-1138, January.
    2. Zimei Liu & Yezhi Ren & Yanlan Mei, 2022. "How Does Internet Use Promote Farmer Entrepreneurship: Evidence from Rural China," Sustainability, MDPI, vol. 14(24), pages 1-15, December.
    3. Alexander Cuntz, 2018. "Creators’ Income Situation in the Digital Age," LIS Working papers 755, LIS Cross-National Data Center in Luxembourg.
    4. Ronja Kirschning & Matthias Mrożewski, 2023. "The role of entrepreneurial absorptive capacity for knowledge spillover entrepreneurship," Small Business Economics, Springer, vol. 60(1), pages 105-120, January.
    5. Alexander Cuntz & Angie L. Miller, 2018. "Unpacking predictors of income and income satisfaction for artists," WIPO Economic Research Working Papers 50, World Intellectual Property Organization - Economics and Statistics Division.
    6. Florentine U. Salmony & Dominik K. Kanbach, 2022. "Personality trait differences across types of entrepreneurs: a systematic literature review," Review of Managerial Science, Springer, vol. 16(3), pages 713-749, April.
    7. Tong Wang & Jiaxuan Liu & Hongyu Zhu & Yuansheng Jiang, 2024. "The Impact of Risk Aversion and Migrant Work Experience on Farmers’ Entrepreneurship: Evidence from China," Agriculture, MDPI, vol. 14(2), pages 1-20, January.

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