Insights into the Psychological Profiles of Entrepreneurs

Hersh Shefrin ()
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Hersh Shefrin: Santa Clara University

Chapter Chapter 9 in Advances in Entrepreneurial Finance, 2011, pp 173-181 from Springer

Abstract: Abstract Entrepreneurs derive lower risk-adjusted returns than non-entrepreneurs, but are compensated through non-pecuniary benefits. This chapter reports on findings from survey evidence. The main findings are as follows: A key non-pecuniary benefit to entrepreneurs is achieving greater control over their working environment. Doing so leads entrepreneurs to report achieving higher affect and well-being than non-entrepreneurs. Entrepreneurs report that they are more skilled socially than non-entrepreneurs. This might provide a partial explanation for why entrepreneurs have a higher marriage rate and larger families than non-entrepreneurs. Entrepreneurs exhibit greater dispositional optimism than non-entrepreneurs. However, in the study sample, the difference is not statistically significant. In terms of preference for lottery-like outcomes, entrepreneurs find prospects offering high returns with low probability attractive, but regard control of their environment as more important than the preference for positive skewness.

Keywords: Life Satisfaction; Risk Tolerance; Dispositional Optimism; Supplementary Survey; High Affect (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-1-4419-7527-0_9

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DOI: 10.1007/978-1-4419-7527-0_9

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