Human capital and the decision to exploit innovative opportunity

Purpose: The purpose of this paper is to examine the direct and interaction effect of individuals’ human capital input and human capital output in the form of entrepreneurial self-confidence on the decision to exploit innovative opportunities. Design/methodology/approach: Using a strategic entrepreneurship perspective, the authors suggest that when individuals with high human capital decide to exploit opportunities they do so by thinking and acting strategically. Strategic action(s) involves pursuing competitive advantages that enable a new venture to get a foothold in the market. The authors argue that such competitive advantages arise from the exploitation of innovative opportunities and individuals with high human capital are more likely to exploit innovative opportunities when they develop entrepreneurial self-confidence. The empirical analysis is based on a random sample of individuals from the adult population who are in the process of creating a new venture. Findings: The results suggest that although human capital inputs and human capital output in the form of entrepreneurial self-confidence are significant factors in influencing the decision to exploit innovative opportunities, human capital inputs interact in different ways with human capital output in influencing this decision. Research limitations/implications: The main limitation of the authors’ study is the use of single item measures as indicators of innovative opportunity and human capital output (entrepreneurial self-confidence). Practical implications: From a macro-perspective, the main implication of the study is that it is possible to assess the quality of entrepreneurship in an economy through individuals’ human capital and the proportion of innovative opportunities in the economy. Moreover, because not all types of human capital inputs influences the exploitation of innovative opportunities, policy makers can be selective in their policy interventions in spawning quality entrepreneurship in their economy. Originality/value: Based on population-level data the authors’ study provides empirical evidence of the nature of entrepreneurial decisions being at the earliest phases of the entrepreneurial process. The study shows the importance of founders’ human capital inputs and outputs in influencing the quality of entrepreneurship in an economy. Moreover, the study extends the understanding the individual-opportunity nexus in promoting innovative entrepreneurship in an economy.Peer ReviewedPostprint (author's final draft

Antecedents of perceived entrepreneurial ability in Catalonia: the individual and the entrepreneurial context

Purpose: The main purpose of this study is to examine the antecedents of perceived entrepreneurial ability within a given context. Design/methodology/approach: Taking the cognitive approach we examine the role of several individual-level factors and the entrepreneurial context in the form of personal knowledge of other entrepreneurs and territorial location in influencing positive perceptions of entrepreneurial ability. The proposed hypotheses are tested on a dataset of 1961 respondents randomly selected from the adult population in Catalonia region in Spain. Findings: Our results reveal that among the individual level factors, a median level of education, experience (both prior entrepreneurial experience and job), task specific knowledge and age have a significantly positive influence on perceived entrepreneurial ability in Catalonia. However, among the entrepreneurial context it is the knowledge of other entrepreneurs rather than territorial location that have a significantly positive influence on perceived entrepreneurial ability. Originality/value: Previous studies have reported that nascent entrepreneurs tend to have significantly favourable perceptions of their entrepreneurial ability. In this study using the cognitive learning framework we examined the antecedents of such perceived entrepreneurial ability thereby extending the stream of studies that look at pre-entry factors that influences entrepreneurial cognitions. The value of our research is in identifying and explaining the combined role of individual-level resources and the contextual environment in influencing one of the most important drivers of nascent entrepreneurship in an economy. Implications: The main implication of our study is that favourable perceptions of entrepreneurial ability can be influenced through participatory learning as well as behavioural modelling. Our study points to several ways through which favourable perception of entrepreneurial ability can be influenced within a given context.Peer ReviewedPostprint (published version

Early internationalization patterns and export market persistence: a pseudo-panel data analysis

This study evaluates the international market persistence of early exporting businesses. The relationship between time in the market and export propensity/intensity levels was analyzed to identify the persistence of the internationalization patterns of entrepreneurial ventures. The empirical application employs a pseudo-panel approach at the business age- and industry-based cohort level drawn from a group of independent cross-sectional surveys that include information for 13,961 independently and randomly selected business owners for the period 2007–2012. The results show that the proportion of firms that export significantly diminishes following the initial post start-up years and that low export intensity levels at start-up leads to greatest tenacity and persistence of the exporting efforts for new firms. The results contribute to the recent discussions on whether early internationalization is an effective strategy and should be encouraged.Peer ReviewedPreprin

Regional variations of the impact of role models and fear of failure on entrepreneurship amongst the youth

This paper examines the joint influence of two individual level factors on entrepreneurship amongst youth residing in the rural regions. Using data from an adult population survey (APS), our empirical results suggest that although the youth in rural regions are equally likely to be positively influenced by entrepreneurial role models, rural youths are more likely to refrain from entrepreneurship because of the greater level of fear of failure compared to urabn youths. We suggest ways how by understanding differences in the influence of entrepreneurial role models and fear of business failure policy makers can design locally relevant entrepreneurship policies. By using a more fine grained analysis in the form of the moderating effect of two important individual level factors, our study contributes to a better understanding of the barriers to entrepreneurship in lagging (rural) regions at the country leve

El efecto transformador de las inversiones en capital territorial para reducir la pobreza: evidencia para México rural

Within the rural development debate, there has been increasing call for a stronger territorial focus that emphasizes the utilization and development of local resources along with the demands of community members. This study evaluates the impact of a poverty reduction program on two well-being dimensions: income and consumption in education and health. The empirical analysis uses a primary dataset of 2,234 beneficiary and non-beneficiary households residing in rural areas of Mexico. The results offer valuable insights on how poverty reduction programs can improve the well-being level in the targeted communities through capability-building interventions linked to investments in two forms of territorial capital, namely human capital and productive assetsComo resultado del debate sobre desarrollo rural ha habido un creciente interés por los enfoques territoriales que enfatizan la utilización y el desarrollo de recursos locales, así como la consideración de las demandas de distintos miembros de la comunidad. Este estudio evalúa el impacto de un programa de reducción de la pobreza sobre dos dimensiones de bienestar: ingresos y consumo en educación y salud. El análisis empírico utiliza una base de datos primaria de 2,234 hogares beneficiarios y no beneficiarios que residen en áreas rurales de México. Los resultados ofrecen información valiosa sobre cómo los programas de reducción de pobreza pueden mejorar el nivel de bienestar en comunidades rurales a través de intervenciones de desarrollo de capacidades vinculadas a inversiones en dos formas de capital territorial, a saber, capital humano y activos productivo

Age, labour market situation and the choice of risky innovative entrepreneurship

International audienceWe examine the effect of age and the moderating effect of labour market situations on individuals’ decisions to enter into risky innovative entrepreneurship. Using population-level data from 94 countries from the Global Entrepreneurship Monitor database we find that although age is negatively related to the choice of innovative entrepreneurship, the age–innovative entrepreneurship choice relationship is moderated by the labour market status of the individual. More specifically, full-time employed older individuals, who are most likely to become successful entrepreneurs, are less likely to choose risky innovative entrepreneurship. Considering that innovative entrepreneurship is crucial for economic growth, our results point to the importance of facilitating employed middle-age and older individuals’ entries into innovative entrepreneurship especially in a context of ageing societies

International Variations in the Impact of Perceived Entrepreneurial Ability and Actual Ability on Entrepreneurial Activities

International audiencePerceived entrepreneurial ability and high actual ability impact entrepreneurial activities, irrespective of the stage of development of the economy, but the joint impact of perceived entrepreneurial ability and high actual ability is not systematic across economies

Fatores socioculturais e o empreendedorismo dos jovens nas regiões rurais

Purpose – This paper aims to demonstrate the impact of two importantsocio-cultural factors on the level of the entrepreneurial activity ofyoung individuals in rural regions.Design/methodology/approach – Our empirical study is based ona sample collected from an adult population survey, and analyzedusing a logit model that controls for territorial and aging sources ofheterogeneity. Our theoretical framework is anchored on a contingencyperspective that emphasizes the unique influences of the contextualenvironment in driving entrepreneurial behavior.Findings – The main findings of our study is that in Spain thelikelihood of being entrepreneurially active is no different for youngand old individuals, and between rural and urban regions. Surprisingly,unlike shown in most studies, entrepreneurial role models do nothave any effect on the entrepreneurship by young individuals in ruralregions of Spain, while the negative impact of fear of failure in theentrepreneurship on young individuals in rural regions is much highercompared to the rest of the population.Originality/value – Our findings reveal that the context (regional)has a more significant impact on entrepreneurship for some segments(younger individuals) of the population than for others.Objetivo – Este trabalho tem por objetivo mostrar o impacto de doisimportantes fatores socioculturais no nível da atividade empreendedorade jovens indivíduos nas regiões rurais.Metodologia – O estudo empírico é baseado em uma amostra coletadade uma pesquisa com população adulta, que foi analisada utilizandoum modelo Logit que faz o controle para as fontes territoriais e deidade da heterogeneidade. O quadro teórico está ancorado em umaperspectiva de contingência que enfatiza as influências únicas doambiente contextual na motivação do comportamento empreendedor.Resultados – Os principais achados deste estudo é que na Espanhaa probabilidade de ser empreendedoramente ativo não difere paraindivíduos jovens e para os mais velhos, e entre as regiões rural e urbana.Surpreendentemente, diferente do mostrado na maioria dos estudos,os modelos exemplares de empreendorismo não têm qualquer efeitono empreendedorismo dos jovens indivíduos nas regiões rurais daEspanha, enquanto que o impacto negativo do medo de fracassar noempreendedorismo dos jovens indivíduos nas regiões rurais é muitomaior do que para o restante da população.Contribuições – Nossos achados revelam que o contexto (regional)tem um impacto mais significativo no empreendedorismo para algunssegmentos (jovens indivíduos) da população do que para outros

Does entrepreneurial confidence influence the nature of entrepreneurial projects chosen by individuals with high ability?

This empirical study of 247 nascent entrepreneurs examines the joint effect of high ability and entrepreneurial confidence is influencing the choice of innovative entrepreneurship. We suggest that in their decision to pursue entrepreneurship aspiring nascent entrepreneurs seek to gain strategic advantages that allow their new ventures to enter and compete in a given marketplace. We argue that aspiring nascent entrepreneurs create such advantages by choosing innovative entrepreneurial projects as opposed to imitative ones. Our results support the hypothesised effects. Considering that innovation is one of the most important and desired outcome of entrepreneurship our results identifies sources of quality entrepreneurship in an economy.Peer Reviewe

Initiating nascent entrepreneurial activities: the relative role of perceived and actual entrepreneurial ability

Purpose: This study examines the direct effect of two individual level resources, one subjective and the other objective, and their interaction in influencing the business entry decision. By distinguishing perceived ability from actual ability and using theoretical underpinnings from the human capital theory and self-efficacy, the proposed hypotheses are tested on a dataset comprising respondents from the adult population. Methodology: Using 20046 observations from the Adult population survey (APS) collected according to the Global Entrepreneurship Monitor (GEM) methodology, a logistic regression analysis controlling for robust interaction term is used to determine the direct as well as the moderating effect of perceived entrepreneurial ability and high actual ability in influencing the decision to initiate nascent entrepreneurial activities. Findings: The results reveal that perceived entrepreneurial ability has a distinct positive influence on the decision to initiate entrepreneurial activities and its impact is greater than that of actual abilities. Furthermore, we find evidence of a positive interaction effect suggesting that perceived entrepreneurial ability is key to encouraging nascent entrepreneurial initiatives among those with high ability. Originality and Value: The main contribution of our study is to highlight the role of subjective judgments of ability in influencing entrepreneurial behaviour. Whereas prior research has found that high actual ability influences new venture performance, its influence on entrepreneurial entry was inconclusive. By adding perceived entrepreneurship to our model we not only establish a link between objective (observable) abilities and subjective (unobservable) abilities of individuals but also suggest the mechanism how such abilities drive the business entry decisions of individuals.Peer Reviewe