Variable risk preferences in new firm growth and survival

Karl Wennberg (), Frédéric Delmar and Alexander McKelvie

Journal of Business Venturing, 2016, vol. 31, issue 4, 408-427

Abstract: We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs' attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures' probability of exit and growth diminishing with age and size.

Keywords: Growth; Survival; Aspiration levels; Focus of attention; New ventures; Risk preferences (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S088390261630009X
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Variable Risk Preferences in New Firm Growth and Survival (2016)
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:eee:jbvent:v:31:y:2016:i:4:p:408-427

DOI: 10.1016/j.jbusvent.2016.05.001

Access Statistics for this article

Journal of Business Venturing is currently edited by S. Venkataraman

More articles in Journal of Business Venturing from Elsevier
Bibliographic data for series maintained by Catherine Liu ().