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The perverse effect of fatalism on entrepreneurial selection

Author

Listed:
  • Gabriele Ruiu

    () (Università degli studi di Sassari, Dipartimento di Scienze Economiche e Aziendali)

Abstract

This paper presents a theoretical model explaining how fatalistic beliefs may influence a person's choice as to whether to become an entrepreneur. The key assumption of the model is that fatalism affects the expected effectiveness of the efforts that will be exerted in running an entrepreneurial project. The main prediction is that fatalism will be a serious obstacle to high ability entrepreneurs but not necessarily to low ability ones. Using GEM and WVS data, we confirm that the effect of fatalism is much stronger for opportunity driven entrepreneurs than for necessity driven entrepreneurs.

Suggested Citation

  • Gabriele Ruiu, 2014. "The perverse effect of fatalism on entrepreneurial selection," Economics Bulletin, AccessEcon, vol. 34(2), pages 901-922.
  • Handle: RePEc:ebl:ecbull:eb-13-00841
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2014/Volume34/EB-14-V34-I2-P85.pdf
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    References listed on IDEAS

    as
    1. Philippe Aghion & Yann Algan & Pierre Cahuc & Andrei Shleifer, 2010. "Regulation and Distrust," The Quarterly Journal of Economics, Oxford University Press, vol. 125(3), pages 1015-1049.
    2. Carlsson, Fredrik & Kataria, Mitesh & Krupnick, Alan & Lampi, Elina & Löfgren, Åsa & Qin, Ping & Sterner, Thomas, 2013. "A fair share: Burden-sharing preferences in the United States and China," Resource and Energy Economics, Elsevier, pages 1-17.
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    5. Michael Stuetzer & Martin Obschonka & Udo Brixy & Rolf Sternberg & Uwe Cantner, 2014. "Regional characteristics, opportunity perception and entrepreneurial activities," Small Business Economics, Springer, pages 221-244.
    6. Michael Fritsch & Alina Rusakova, 2010. "Personality Traits, Self-Employment, and Professions," Jena Economic Research Papers 2010-075, Friedrich-Schiller-University Jena.
    7. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2007. "Enhanced routines for instrumental variables/GMM estimation and testing," CERT Discussion Papers 0706, Centre for Economic Reform and Transformation, Heriot Watt University.
    8. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
    9. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2006. "Does Culture Affect Economic Outcomes?," Journal of Economic Perspectives, American Economic Association, pages 23-48.
    10. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2007. "Enhanced routines for instrumental variables/GMM estimation and testing," CERT Discussion Papers 0706, Centre for Economic Reform and Transformation, Heriot Watt University.
    11. Ghatak, Maitreesh & Morelli, Massimo & Sjostrom, Tomas, 2007. "Entrepreneurial talent, occupational choice, and trickle up policies," Journal of Economic Theory, Elsevier, vol. 137(1), pages 27-48, November.
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    13. repec:spo:wpecon:info:hdl:2441/8883 is not listed on IDEAS
    14. Michael Stuetzer & Martin Obschonka & Udo Brixy & Rolf Sternberg & Uwe Cantner, 2014. "Regional characteristics, opportunity perception and entrepreneurial activities," Small Business Economics, Springer, pages 221-244.
    15. repec:cup:apsrev:v:81:y:1987:i:01:p:3-21_19 is not listed on IDEAS
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    More about this item

    Keywords

    Entrepreneurship; Fatalism; Occupational Choice;

    JEL classification:

    • J0 - Labor and Demographic Economics - - General
    • Z1 - Other Special Topics - - Cultural Economics

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