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Published on: September 19, 2012
Risk propensity differences between entrepreneurs and managers: a meta-analytic review
1Department of Management, Clemson University, South Carolina 29634-1305, USA. waynes@clemson.edu
The Journal of Applied Psychology
|April 17, 2001
Summary
Entrepreneurs exhibit greater risk-taking propensity than managers. Differences are more pronounced between growth-focused entrepreneurs and those prioritizing family income, highlighting the need for precise definitions in risk propensity research.
Area of Science:
- Entrepreneurship and Management Studies
- Behavioral Economics
- Organizational Psychology
Background:
- Conflicting findings exist regarding the risk-taking propensities of entrepreneurs versus managers.
- Lack of consensus hinders theoretical development in entrepreneurship research.
- Previous narrative reviews have limitations in synthesizing this literature.
Purpose of the Study:
- To quantitatively synthesize the existing literature on risk propensity differences between entrepreneurs and managers.
- To resolve discrepancies in previous research findings.
- To provide a more robust understanding of entrepreneurial risk-taking.
Main Methods:
- Psychometric meta-analysis was employed to mathematically aggregate findings from multiple studies.
- The study focused on comparing risk propensity scores between defined groups of entrepreneurs and managers.
- Rigorous measurement and precise construct definitions were emphasized.
Main Results:
- Entrepreneurs, as a group, demonstrate a significantly higher risk propensity than managers.
- Substantial variations in risk propensity exist among entrepreneurs based on their venture goals (e.g., growth vs. family income).
- The quality of construct definition and measurement significantly impacts observed differences.
Conclusions:
- The study confirms that entrepreneurs are generally more risk-prone than managers.
- Venture goals are a critical moderator of entrepreneurial risk-taking behavior.
- Future research must prioritize methodological rigor and clear definitions for advancing theory in this field.
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