IDEAS home Printed from https://ideas.repec.org/a/bpj/erjour/v12y2022i4p471-500n6.html
   My bibliography  Save this article

Do You Need to be Risk-Tolerant to Become an Entrepreneur? The Importance of the Reference Point

Author

Listed:
  • Fuentelsaz Lucio
  • Maicas Juan P.
  • Montero Javier

    (Department of Management, University of Zaragoza, Gran Via 2, Zaragoza, 50005, Spain)

Abstract

The creation of new ventures involves a great deal of risk and uncertainty. However, research has been theoretically divergent and empirically inconclusive about the influence of individuals’ risk tolerance on entrepreneurial entry. In this paper, we argue that this relationship is contingent on the reference point of individuals, taking into account the human capital and the opportunity cost of individuals when they decide to start a venture. This approach allows us to clarify some of the previous mixed results in the literature. We use a sample of almost 600,000 individuals from 90 countries that have participated in the Global Entrepreneurship Monitor project between 2010 and 2014. Our results show that individuals with previous experience as entrepreneurs do not need to be so risk-tolerant to set up their own venture, while individuals with a job and/or a high educational level need to be especially risk-tolerant to become entrepreneurs.

Suggested Citation

  • Fuentelsaz Lucio & Maicas Juan P. & Montero Javier, 2022. "Do You Need to be Risk-Tolerant to Become an Entrepreneur? The Importance of the Reference Point," Entrepreneurship Research Journal, De Gruyter, vol. 12(4), pages 471-500, October.
    • Handle: RePEc:bpj:erjour:v:12:y:2022:i:4:p:471-500:n:6
    DOI: 10.1515/erj-2019-0292
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/erj-2019-0292
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/erj-2019-0292?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:erjour:v:12:y:2022:i:4:p:471-500:n:6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.