Emotions, cognitions and the individual-opportunity nexus
Citation for published version (APA):Michl, T., Welpe, I. M., Spörrle, M., & Picot, A. (2009). Emotions, cognitions and the individual-opportunity nexus: interactive paper. In Proceedings of the 30th Annual Babson College Entrepreneurship Research Conference (BCERC), June 9-12, 2010, Lausanne, Switzerland [24] (Frontiers of Entrepreneurship Research; Vol. 29, No. 6).
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Frontiers of Entrepreneurship Research
Volume 29 | Issue 6
CHAPTER VI. ENTREPRENEURIAL
COGNITION
Article 24
6-6-2009
EMOTIONS, COGNITIONS AND THE
INDIVIDUAL-OPPORTUNITY-NEXUS
(INTERACTIVE PAPER)
Theresa Michl
Ludwig-Maximilians-University Munich, Germany, michl@lmu.de
Isabell M. Welpe
Technical University Munich, Germany
Matthias Spörrle
University of Applied Management Erding, Germany
Arnold Picot
Ludwig-Maximilians-University Munich, Germany
This Interactive Paper is brought to you for free and open access by the Entrepreneurship at Babson at Digital Knowledge at Babson. It has been accepted for inclusion in Frontiers of Entrepreneurship Research by an authorized administrator of Digital Knowledge at Babson. For more information, please contactdigitalknowledge@babson.edu.
Recommended Citation
Michl, Theresa; Welpe, Isabell M.; Spörrle, Matthias; and Picot, Arnold (2009) "EMOTIONS, COGNITIONS AND THE INDIVIDUAL-OPPORTUNITY-NEXUS (INTERACTIVE PAPER)," Frontiers of Entrepreneurship Research: Vol. 29: Iss. 6, Article 24.
INTERACTIVE PAPER
EMOTIONS, COGNITIONS AND THE INDIVIDUAL-OPPORTUNITY-NEXUS
Theresa Michl, Ludwig-Maximilians-University Munich, Germany Isabell M. Welpe, Technical University Munich, Germany Matthias Spörrle, University of Applied Management Erding, Germany
Arnold Picot, Ludwig-Maximilians-University Munich, Germany
Principal Topic
The question why some individuals and not others exploit entrepreneurial opportunities is still not answered. There is consensus that the nature of opportunity plays a key part in the pre-entrepreneurial decision-making process (e. g. Lang-von Wins 2004, Phan et al. 2002) which contains the recognition, the evaluation and the exploitation of an entrepreneurial opportunity (Shane and Venkataraman 2000). Some researchers (e. g. Busenitz and Lau 1996, Mitchell et al. 2000) argue that the subjective, mental processes in individuals play a crucial role in the pre-entrepreneurial process and for the decision to exploit an opportunity. Therefore, this study seeks to explore individuals’ different perceptions of entrepreneurial opportunities and the role of cognitive appraisals and affective states in this perception-shaping process in order to fill the gap of the ‘Individual-Opportunity-Nexus’ (Shane 2003).
Method
This study was constructed as a questionnaire experiment with a scenario technique commonly used within the field of entrepreneurship research (e. g. Burmeister and Schade 2007, Norton and Moore 2006) and in the field of psychological research on emotions (e. g. Sabini and Silver 2005, McGraw 1987). Participants were given an entrepreneurial scenario with four independent variables: profit margin (high vs. low), time to profit (long vs. short), prior investment (high vs. low), and probability of success (high vs. low). This resulted in a 2×2×2×2 fully crossed design with 16 different scenarios, each one distributed randomly. We received 578 responses under which we identified 185 employees, 183 students, and 159 entrepreneurs.
Results and Implications
Our findings indicate that the perceived situational characteristics profit margin and probability of success are more important in the entrepreneurial decision-making process than are the perceived time to profit and prior investment. Moreover primary appraisal can be regarded as a central variable of the evaluation and exploitation of an entrepreneurial opportunity, however, secondary appraisal is not. Entrepreneurial evaluation was found to be a direct antecedent of the individual tendency to exploit an opportunity. In addition to this, the negative affective state of anxiety was found to have direct negative effects on evaluation and exploitation and reduces the influence of evaluation on exploitation. On the other hand, the positive affective state of joy was found to have a direct positive effect and increases evaluation's influence on exploitation. Our results confirm that entrepreneurs are more metered by the fear of failure than they are attracted by the prospects of great success which is consistent which recent research that shows that a powerful negativity bias exists at a physiological level (Vaish et al. 2008).
CONTACT: Theresa Michl; michl@lmu.de; (T): +49 (0)89 2180 – 3862; (F): +49 (0)89 2180 –
3685; Ludwig-Maximilians-University, Munich School of Management.
1 Michl et al.: EMOTIONS, COGNITIONS AND THE INDIVIDUAL-OPPORTUNITY-NEXUS
Frontiers of Entrepreneurship Research 2009
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