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The perverse effect of fatalism on entrepreneurial selection

  • Gabriele Ruiu

    ()

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

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.

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File URL: http://www.accessecon.com/Pubs/EB/2014/Volume34/EB-14-V34-I2-P85.pdf
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Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 34 (2014)
Issue (Month): 2 ()
Pages: 901-922

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Handle: RePEc:ebl:ecbull:eb-13-00841
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  1. Guido Tabellini, 2006. "Culture and institutions: economic development in the regions of Europe," Levine's Working Paper Archive 321307000000000466, David K. Levine.
  2. Baumol, William J, 1990. "Entrepreneurship: Productive, Unproductive, and Destructive," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 893-921, October.
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  5. Robert J. Barro & Jong-Wha Lee, 2010. "A New Data Set of Educational Attainment in the World, 1950-2010," NBER Working Papers 15902, National Bureau of Economic Research, Inc.
  6. 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.
  7. 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.
  8. Guiso, Luigi & Sapienza, Paola & Zingales, Luigi, 2006. "Does Culture Affect Economic Outcomes?," CEPR Discussion Papers 5505, C.E.P.R. Discussion Papers.
  9. Michael Stuetzer & Martin Obschonka & Udo Brixy & Rolf Sternberg & Uwe Cantner, 2014. "Regional characteristics, opportunity perception and entrepreneurial activities," Small Business Economics, Springer, vol. 42(2), pages 221-244, February.
  10. repec:spo:wpecon:info:hdl:2441/8883 is not listed on IDEAS
  11. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2007. "Enhanced routines for instrumental variables/GMM estimation and testing," Boston College Working Papers in Economics 667, Boston College Department of Economics, revised 05 Sep 2007.
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