IDEAS home Printed from https://ideas.repec.org/p/cdl/ucscec/qt9x83w5k4.html
   My bibliography  Save this paper

Entrepreneurship Training, Risk Aversion and Other Personality Traits: Evidence from a Random Experiment

Author

Listed:
  • Fairlie, Robert

Abstract

A growing literature examines the relationship between personality traits and entrepreneurship, but no previous studies explore whether personality or psychological traits predispose individuals to benefit more from entrepreneurship training. To address selection issues, we use novel data from the largest-ever randomized control experiment providing entrepreneurship training in the United States. We find evidence indicating that individuals who are more risk tolerant benefit more from entrepreneurship training than less risk tolerant individuals. We find some limited evidence that individuals who have a preference for autonomy benefit more from entrepreneurship training in the short run, but we find no evidence of longer-term effects and no evidence of differential effects of entrepreneurship training for individuals who are more innovative.

Suggested Citation

  • Fairlie, Robert, 2014. "Entrepreneurship Training, Risk Aversion and Other Personality Traits: Evidence from a Random Experiment," Santa Cruz Department of Economics, Working Paper Series qt9x83w5k4, Department of Economics, UC Santa Cruz.
  • Handle: RePEc:cdl:ucscec:qt9x83w5k4
    as

    Download full text from publisher

    File URL: http://www.escholarship.org/uc/item/9x83w5k4.pdf;origin=repeccitec
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Caliendo, Marco & Fossen, Frank & Kritikos, Alexander, 2010. "The impact of risk attitudes on entrepreneurial survival," Journal of Economic Behavior & Organization, Elsevier, vol. 76(1), pages 45-63, October.
    2. Dean Karlan & Martin Valdivia, 2011. "Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 510-527, May.
    3. Joop Hartog & Mirjam Van Praag & Justin Van Der Sluis, 2010. "If You Are So Smart, Why Aren't You an Entrepreneur? Returns to Cognitive and Social Ability: Entrepreneurs Versus Employees," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 19(4), pages 947-989, December.
    4. Robert W. Fairlie & Alicia M. Robb, 2008. "Race and Entrepreneurial Success: Black-, Asian-, and White-Owned Businesses in the United States," MIT Press Books, The MIT Press, edition 1, volume 1, number 026206281x, January.
    5. William D. Bradford, 2003. "The Wealth Dynamics of Entrepreneurship for Black and White Families in the U.S," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 49(1), pages 89-116, March.
    6. Samuel Myers, 1989. "Nea presidential address: Political economy, race, and morals," The Review of Black Political Economy, Springer;National Economic Association, vol. 18(1), pages 5-15, June.
    7. Marco Caliendo & Frank Fossen & Alexander Kritikos, 2009. "Risk attitudes of nascent entrepreneurs–new evidence from an experimentally validated survey," Small Business Economics, Springer, vol. 32(2), pages 153-167, February.
    8. Evans, David S & Leighton, Linda S, 1989. "Some Empirical Aspects of Entrepreneurship," American Economic Review, American Economic Association, vol. 79(3), pages 519-535, June.
    9. Holtz-Eakin, Douglas & Joulfaian, David & Rosen, Harvey S, 1994. "Sticking It Out: Entrepreneurial Survival and Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 102(1), pages 53-75, February.
    10. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-670, May.
    11. Parker,Simon C., 2009. "The Economics of Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521899604, March.
    12. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde & Juergen Schupp & Gert Wagner, 2005. "Individual Risk Attitudes: New Evidence from a Large, Representative, Experimentally-Validated Survey," Working Papers 2096, The Field Experiments Website.
    13. Robert W. Fairlie, 2002. "Drug Dealing and Legitimate Self-Employment," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 538-567, July.
    14. Blau, David M, 1987. "A Time-Series Analysis of Self-employment in the United State," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 445-467, June.
    15. Evans, David S & Jovanovic, Boyan, 1989. "An Estimated Model of Entrepreneurial Choice under Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 808-827, August.
    16. repec:mpr:mprres:6190 is not listed on IDEAS
    17. Kourilsky, Marilyn L. & Walstad, William B., 1998. "Entrepreneurship and female youth: knowledge, attitudes, gender differences, and educational practices," Journal of Business Venturing, Elsevier, vol. 13(1), pages 77-88, January.
    18. Blanchflower, David G & Oswald, Andrew J, 1998. "What Makes an Entrepreneur?," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 26-60, January.
    19. P. Köllinger & M. Minniti, 2006. "Not for Lack of Trying: American Entrepreneurship in Black and White," Small Business Economics, Springer, vol. 27(1), pages 59-79, August.
    20. Blanchflower, David G. & Oswald, Andrew & Stutzer, Alois, 2001. "Latent entrepreneurship across nations," European Economic Review, Elsevier, vol. 45(4-6), pages 680-691, May.
    21. Oosterbeek, Hessel & van Praag, Mirjam & Ijsselstein, Auke, 2010. "The impact of entrepreneurship education on entrepreneurship skills and motivation," European Economic Review, Elsevier, vol. 54(3), pages 442-454, April.
    22. Rees, Hedley & Shah, Anup, 1986. "An Empirical Analysis of Self-employment in the U.K," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 1(1), pages 95-108, January.
    23. Dunn, Thomas & Holtz-Eakin, Douglas, 2000. "Financial Capital, Human Capital, and the Transition to Self-Employment: Evidence from Intergenerational Links," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 282-305, April.
    24. Parker,Simon C., 2009. "The Economics of Entrepreneurship," Cambridge Books, Cambridge University Press, number 9780521728355, March.
    25. Dean Karlan & Martin Valdivia, 2011. "Teaching Entrepreneurship: Impact of Business Training on Microfinance Clients and Institutions," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 510-527, May.
    26. 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.
    27. Thomas Dunn & Douglas Holtz-Eakin, 1996. "Financial Capital, Human Capital, and the Transition to Self-Employment:Evidence from Intergenerational Links," NBER Working Papers 5622, National Bureau of Economic Research, Inc.
    28. Kihlstrom, Richard E & Laffont, Jean-Jacques, 1979. "A General Equilibrium Entrepreneurial Theory of Firm Formation Based on Risk Aversion," Journal of Political Economy, University of Chicago Press, vol. 87(4), pages 719-748, August.
    29. van Praag, C M & Cramer, J S, 2001. "The Roots of Entrepreneurship and Labour Demand: Individual Ability and Low Risk Aversion," Economica, London School of Economics and Political Science, vol. 68(269), pages 45-62, February.
    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. Francine Lafontaine & Kathryn Shaw, 2016. "Serial Entrepreneurship: Learning by Doing?," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages 217-254.
    2. Marco Caliendo & Frank Fossen & Alexander Kritikos, 2014. "Personality characteristics and the decisions to become and stay self-employed," Small Business Economics, Springer, vol. 42(4), pages 787-814, April.
    3. Ayala, Juan-Carlos & Manzano, Guadalupe, 2014. "The resilience of the entrepreneur. Influence on the success of the business. A longitudinal analysis," Journal of Economic Psychology, Elsevier, vol. 42(C), pages 126-135.
    4. Pamela Lenton, 2017. "Being your own boss: the many faces of self-employment," Working Papers 2017003, The University of Sheffield, Department of Economics.
    5. Kathryn L. Shaw & Anders Sørensen, 2017. "The Productivity Advantage of Serial Entrepreneurs," NBER Working Papers 23320, National Bureau of Economic Research, Inc.
    6. Christoph Bühren & Philip J. Steinberg, 2017. "The impact of psychological traits on performance in sequential tournaments: Evidence from a tennis field experiment," MAGKS Papers on Economics 201705, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    7. Paul, Justin & Shrivatava, Archana, 2016. "Do young managers in a developing country have stronger entrepreneurial intentions? Theory and debate," International Business Review, Elsevier, vol. 25(6), pages 1197-1210.
    8. repec:eee:jeborg:v:150:y:2018:i:c:p:432-445 is not listed on IDEAS
    9. Sharma, Smriti & Tarp, Finn, 2018. "Does managerial personality matter? Evidence from firms in Vietnam," Journal of Economic Behavior & Organization, Elsevier, vol. 150(C), pages 432-445.
    10. Nadeem Khalid & Munwar Hussain Pahi & Sallam Bin Abdullah, 2016. "Investigating the Moderation of Organizational Culture on the Relationship between Innovativeness, Reactiveness, and Risk-Taking Propensity with Business Performance: A Case of Pakistan," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(10), pages 326-338, October.
    11. Michael Kremer & Jonathan Robinson & Olga Rostapshova, 2014. "Success in Entrepreneurship: Doing the Math," NBER Chapters,in: African Successes, Volume II: Human Capital, pages 281-303 National Bureau of Economic Research, Inc.
    12. Randall Akee & Elton Mykerezi & Richard M. Todd, 2017. "Reservation Employer Establishments: Data from the U.S. Census Longitudinal Business Database," Working Papers 17-57, Center for Economic Studies, U.S. Census Bureau.
    13. Maciej Jakubowski, 2015. "Latent variables and propensity score matching: a simulation study with application to data from the Programme for International Student Assessment in Poland," Empirical Economics, Springer, vol. 48(3), pages 1287-1325, May.
    14. repec:eee:ijrema:v:35:y:2018:i:1:p:60-80 is not listed on IDEAS
    15. repec:nbr:nberch:13358 is not listed on IDEAS

    More about this item

    Keywords

    Business; Education; Social and Behavioral Sciences; entrepreneurship; education; training; psychology; experiment;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:cdl:ucscec:qt9x83w5k4. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lisa Schiff). General contact details of provider: http://edirc.repec.org/data/ecucsus.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.