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The Effect of Risk Perception and Cognitive Biases on the Evaluation of Opportunity in Family and Non-Family Entrepreneurs: The Case of Tunisian Entrepreneurs

Author

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  • Najoua Dali

    (Institut Supérieur de Gestion de Sousse, Tunisia)

  • Sana Harbi

    (Institut Supérieur de Finance et de Fiscalité de Sousse, Tunisia)

Abstract

This study uses cognitive biases to examine opportunity evaluation among family and non-family entrepreneurs, and investigated the effect of risk perception in this type of entrepreneurs. The aim of this paper is to examine empirically if family entrepreneurs differ in terms of risk perception and opportunity evaluation from non-family entrepreneurs. We use a sample of 144 established businesses to run both test hypothesis and regression analysis. Our results indicate that there is no significant difference between the two categories of entrepreneurs. The structural regression analysis suggests that risk perception mediates opportunity evaluation and that (i) the belief in the law of small numbers and (ii) the illusion of control decreases risk perception among entrepreneurs when evaluating an opportunity.

Suggested Citation

  • Najoua Dali & Sana Harbi, 2016. "The Effect of Risk Perception and Cognitive Biases on the Evaluation of Opportunity in Family and Non-Family Entrepreneurs: The Case of Tunisian Entrepreneurs," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 24(03), pages 281-312, September.
    • Handle: RePEc:wsi:jecxxx:v:24:y:2016:i:03:n:s0218495816500114
    DOI: 10.1142/S0218495816500114
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