Entrepreneurship: Cause or Consequence of Financial Optimism?

Chris Dawson (), David de Meza, Andrew Henley and Reza (Gholamreza) Arabsheibani ()

No 6844, IZA Discussion Papers from IZA Network @ LISER

Abstract: Extant evidence that the self-employed overestimate their returns by more than employees do is consistent with two mutually inclusive possibilities. Self-employment may generate optimism or optimists may be drawn to self-employment. This paper finds that employees who will be self-employed in the future overestimate their short-run financial wellbeing by more than those who never become self-employed. When actually self-employed they are even more optimistic. Employees aspiring to start their own business are also of above average optimism. Cross-sectional findings are therefore an amalgam of psychological disposition and environmental factors, as theory requires if optimism is to be a causal influence on entrepreneurship.

Keywords: financial optimism; expectations; self-employment (search for similar items in EconPapers)
JEL-codes: D84 M13 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2012-09
New Economics Papers: this item is included in nep-bec and nep-ent
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published - published in: Journal of Economics and Management Strategy, 2014, 23(4), 717–742

Downloads: (external link)
https://docs.iza.org/dp6844.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp6844

Access Statistics for this paper

More papers in IZA Discussion Papers from IZA Network @ LISER Contact information at EDIRC.
Bibliographic data for series maintained by Mark Fallak ().