Exploring entrepreneurial decision-making strategies

William Benjamin Martz Jr., Thomas Neil and Alessandro Biscaccianti

International Journal of Innovation and Learning, 2006, vol. 3, issue 6, 658-672

Abstract: The way individuals make decisions has been researched from many contexts giving rise to theoretical explanations. Two of these theories, a satisficing model and a reference-dependent model, evolved from this research. The purpose of this study is to explore how well these models explain the decision making observed in a hypothetical entrepreneurial, managerial setting that allocates a limited resource among ten interlocked alternatives over two decision periods. The results show that in this context, decision making is reference dependent. Further analysis demonstrates that a model based on aspiring to a minimal satisfaction level (aspiration seeking) better explains the results.

Keywords: entrepreneurs; innovation; learning; loss aversion; satisficing; reference-dependent model; decision-making. (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijilea:v:3:y:2006:i:6:p:658-672

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