IDEAS home Printed from https://ideas.repec.org/a/sae/entthe/v30y2006i4p477-493.html
   My bibliography  Save this article

Entrepreneurs, Effectual Logic, and Over–Trust

Author

Listed:
  • Sanjay Goel
  • Ranjan Karri

Abstract

This article complements extant literature on entrepreneurship and trust by proposing a model of over–trust (the tendency to trust more than what is warranted) using entrepreneurial characteristics and effectual logic. We trace how entrepreneurs following effectual processes may tend to over–trust. More formally, we propose that specific personality characteristics of the entrepreneur interact with effectual logic to make the entrepreneur more susceptible to over–trust. The proposed model is value neutral in that we do not imply that over–trust has negative consequences for entrepreneurs. In fact, it may be part of the overall risk that entrepreneurs assume in a new venture creation.

Suggested Citation

  • Sanjay Goel & Ranjan Karri, 2006. "Entrepreneurs, Effectual Logic, and Over–Trust," Entrepreneurship Theory and Practice, , vol. 30(4), pages 477-493, July.
    • Handle: RePEc:sae:entthe:v:30:y:2006:i:4:p:477-493
    DOI: 10.1111/j.1540-6520.2006.00131.x
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1111/j.1540-6520.2006.00131.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1540-6520.2006.00131.x?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
    ---><---

    References listed on IDEAS

    as
    1. Charles R. Schwenk, 1988. "The Cognitive Perspective On Strategic Decision Making," Journal of Management Studies, Wiley Blackwell, vol. 25(1), pages 41-55, January.
    2. Brenkert, George G., 1998. "Trust, Morality and International Business," Business Ethics Quarterly, Cambridge University Press, vol. 8(2), pages 293-317, April.
    3. Friederike Welter & Teemu Kautonen & Alexander Chepurenko & Elena Malieva & Urve Venesaar, 2004. "Trust Environments And Entrepreneurial Behavior – Exploratory Evidence From Estonia, Germany And Russia," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 12(04), pages 327-349.
    4. Richard T. Harrison & Mark R. Dibben & Colin M. Mason, 1997. "The Role of Trust in the Informal Investor's Investment Decision: An Exploratory Analysis," Entrepreneurship Theory and Practice, , vol. 21(4), pages 63-81, July.
    5. James C. Hayton & Gerard George & Shaker A. Zahra, 2002. "National Culture and Entrepreneurship : A Review of Behavioral Research," Entrepreneurship Theory and Practice, , vol. 26(4), pages 33-52, July.
    6. Erikson, Truls, 2002. "Entrepreneurial capital: the emerging venture's most important asset and competitive advantage," Journal of Business Venturing, Elsevier, vol. 17(3), pages 275-290, May.
    7. Gideon D. Markman & David B. Balkin & Robert A. Baron, 2002. "Inventors and New Venture Formation: the Effects of General Self–Efficacy and Regretful Thinking," Entrepreneurship Theory and Practice, , vol. 27(2), pages 149-165, April.
    8. McGrath, Rita Gunther & MacMillan, Ian C. & Scheinberg, Sari, 1992. "Elitists, risk-takers, and rugged individualists? An exploratory analysis of cultural differences between entrepreneurs and non-entrepreneurs," Journal of Business Venturing, Elsevier, vol. 7(2), pages 115-135, March.
    9. Williamson, Oliver E, 1993. "Calculativeness, Trust, and Economic Organization," Journal of Law and Economics, University of Chicago Press, vol. 36(1), pages 453-486, April.
    10. Shane, Scott A., 1992. "Why do some societies invent more than others?," Journal of Business Venturing, Elsevier, vol. 7(1), pages 29-46, January.
    11. Heath, Chip & Tversky, Amos, 1991. "Preference and Belief: Ambiguity and Competence in Choice under Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 4(1), pages 5-28, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aleksandra Gawel & Timo Toikko, 2023. "Quality of Governance and Welfare Generosity as Institutional Predictors of Entrepreneurship: European Perspective," SAGE Open, , vol. 13(4), pages 21582440231, October.
    2. Patricia Strauß & Andrea Greven & Malte Brettel, 2021. "Determining the influence of national culture: insights into entrepreneurs’ collective identity and effectuation," International Entrepreneurship and Management Journal, Springer, vol. 17(2), pages 981-1006, June.
    3. Claus Schreier & Sylvie Scherrer & Nuntana Udomkit & Jillaine Farrar, 2020. "Trustworthy Small and Medium-sized Enterprise Network Partners: Small and Medium-sized Enterprise Partnerships in the International Entrepreneurial Process," Global Business Review, International Management Institute, vol. 21(1), pages 88-107, February.
    4. Andrew L. Maxwell & Moren Lévesque, 2014. "Trustworthiness: A Critical Ingredient for Entrepreneurs Seeking Investors," Entrepreneurship Theory and Practice, , vol. 38(5), pages 1057-1080, September.
    5. Saras Sarasvathy & K. Kumar & Jeffrey G. York & Suresh Bhagavatula, 2014. "An Effectual Approach to International Entrepreneurship: Overlaps, Challenges, and Provocative Possibilities," Entrepreneurship Theory and Practice, , vol. 38(1), pages 71-93, January.
    6. Oliveira, Luis & Johanson, Martin, 2021. "Trust and firm internationalization: Dark-side effects on internationalization speed and how to alleviate them," Journal of Business Research, Elsevier, vol. 133(C), pages 1-12.
    7. Mumford, Jonathan Van & Zettinig, Peter, 2022. "Co-creation in effectuation processes: A stakeholder perspective on commitment reasoning," Journal of Business Venturing, Elsevier, vol. 37(4).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. María-José Pinillos & Luisa Reyes, 2011. "Relationship between individualist–collectivist culture and entrepreneurial activity: evidence from Global Entrepreneurship Monitor data," Small Business Economics, Springer, vol. 37(1), pages 23-37, July.
    2. David Urbano & Sebastian Aparicio & Victor Querol, 2016. "Social progress orientation and innovative entrepreneurship: an international analysis," Journal of Evolutionary Economics, Springer, vol. 26(5), pages 1033-1066, December.
    3. Michael E. Valdez & James Richardson, 2013. "Institutional Determinants of Macro–Level Entrepreneurship," Entrepreneurship Theory and Practice, , vol. 37(5), pages 1149-1175, September.
    4. Kim Looi & Yusniza Kamarulzaman, 2015. "Convergence in the priorities of entrepreneurial values: Empirical evidence from Malaysia," Journal of International Entrepreneurship, Springer, vol. 13(1), pages 67-88, March.
    5. Shu, Rui & Ren, Shenggang & Zheng, Yi, 2018. "Building networks into discovery: The link between entrepreneur network capability and entrepreneurial opportunity discovery," Journal of Business Research, Elsevier, vol. 85(C), pages 197-208.
    6. Schmutzler, Jana & Andonova, Veneta & Díaz Serrano, Lluís, 2015. "When culture does (not) matter: role models and self-efficacy as drivers of entrepreneurial behavior," Working Papers 2072/247806, Universitat Rovira i Virgili, Department of Economics.
    7. Emmanuel Affum-Osei & Sharon G. Goto & June Chun Yeung & Rong Wang & Hodar Lam & Inusah Abdul-Nasiru & Darius K. S. Chan, 2024. "A cross-cultural study of entrepreneurial motivation and entrepreneurial intentions amongst university students: the roles of individualism and collectivism," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 14(1), pages 1-19, December.
    8. Ingrid Verheul & André Van Stel & Roy Thurik, 2006. "Explaining female and male entrepreneurship at the country level," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 18(2), pages 151-183, March.
    9. Julie Ann Elston & Alois Weidinger, 2019. "Entrepreneurial intention and regional internationalization in China," Small Business Economics, Springer, vol. 53(4), pages 1001-1015, December.
    10. Sjoerd Beugelsdijk, 2010. "Entrepreneurial Culture, Regional Innovativeness and Economic Growth," Springer Books, in: Andreas Freytag & Roy Thurik (ed.), Entrepreneurship and Culture, chapter 0, pages 129-154, Springer.
    11. Mojca Svetek, 2023. "The Role of Entrepreneurs’ Perceived Competence and Cooperativeness in Early-Stage Financing," Entrepreneurship Theory and Practice, , vol. 47(6), pages 2047-2076, November.
    12. Mueller, Stephen L. & Thomas, Anisya S., 2001. "Culture and entrepreneurial potential: A nine country study of locus of control and innovativeness," Journal of Business Venturing, Elsevier, vol. 16(1), pages 51-75, January.
    13. Malik, Tariq H. & Xiang, Tao & Huo, Chunhui, 2021. "The transformation of national patents for high-technology exports: Moderating effects of national cultures," International Business Review, Elsevier, vol. 30(1).
    14. Castellani, Marco, 2019. "Does culture matter for the economic performance of countries? An overview of the literature," Journal of Policy Modeling, Elsevier, vol. 41(4), pages 700-717.
    15. Barreto, Tais S. & Lanivich, Stephen E. & Cox, Kevin C., 2022. "Temporal orientation as a robust predictor of innovation," Journal of Business Research, Elsevier, vol. 138(C), pages 287-300.
    16. Kleinhempel, Johannes & Estrin, Saul, 2024. "Realizing expectations?," MPRA Paper 120863, University Library of Munich, Germany.
    17. Achim Monica Violeta & Borlea Sorin Nicolae & Văidean Viorela Ligia, 2021. "Culture, Entrepreneurship and Economic Development. An Empirical Approach," Entrepreneurship Research Journal, De Gruyter, vol. 11(1), pages 1-28, January.
    18. Ilhami Yucel, 2011. "Entrepreneurial orientation, executives individualism and Firm Performance: The moderating role of executives individualism," Far East Journal of Psychology and Business, Far East Research Centre, vol. 5(3), pages 63-77, December.
    19. André van Stel & Roy Thurik & Ingrid Verheul, 2004. "Explaining female and male entrepreneurship across 29 countries," Scales Research Reports N200403, EIM Business and Policy Research.
    20. Davidsson, Per & Wiklund, Johan, 1997. "Values, beliefs and regional variations in new firm formation rates," Journal of Economic Psychology, Elsevier, vol. 18(2-3), pages 179-199, April.

    More about this item

    Statistics

    Access and download statistics

    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:sae:entthe:v:30:y:2006:i:4:p:477-493. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: SAGE Publications (email available below). General contact details of provider: .

    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.