Anda di halaman 1dari 24

Entrepreneurial intention:

antecedents to
entrepreneurial
behaviour in the U.S.A. &
Turkey
BY NUDRAN OZARALLI AND NANCY K RIVENBURGH
PRESENTED BY MUHAMMAD FAROOQ SIDDIQUI
Introduction

 Antecedent means Logically precedes another or a thing that existed


before
 Importance of promoting entrepreneurship in developed & developing
worlds.
 Comparing & contrasting United States - Turkey to learn about variables
influencing entrepreneurial traits in young people in culturally diverse
context
 Factors relevant to nurturing early entrepreneurial intentions – personality
traits, family & friends, experiences & education, political & economic
condition & perceived motivation and obstacles
 Results of 3 potential influences: Personality factors, social factors &
societal factors
Background

 Universally defining entrepreneurship as the process of creating something new with value by
devoting the necessary time & effort, assuming the accompanying financial, psychic, and social
risks, and receiving the resulting awards of monetary & personal satisfaction & independence
 United States – Policy incentives, relatively open immigration policy, other structural factors plus a
culture of determination & motivation. Global Entrepreneurship Monitor (2013) – US exhibits one
of the highest entrepreneurship rates in the developed world.
 US- 51% prefer working alone – Europe 58% prefer working as employee in a firm
 Reason for lack of entrepreneurial intent in Europe: Lack of business experience, difficulty to raise
start up capital, red tape, poor economic environment & an innate European fear of failure ---
Eurobarometer Survey on Entrepreneurship
 Turkey- Growing economy with declining inflation rates, diverse industrial base, strong domestic
market, relatively stable political/economic environment and progressive economic policies
encourage entrepreneurship. Population is young providing an enhanced talent pool
 Turkey is ranked 52nd for entrepreneurship in the world – 9 out of 100 are entrepreneurs (GEM
2010)
Background

 Turkey – Incentivizing entrepreneurial culture through tax reforms,


regulations & support programs
 Educating entrepreneurship in Turkey – long way to go!
 US – more then 60% 18-29 year olds aspire to have their own
businesses
 Despite the stat very few prefer entrepreneurship career to pursue
 Questioning generalizability of a “western” trait on rest of the world
 Cross cultural study on entrepreneurial intent amongst young minds
 Turkish culture is a blend of Eastern & Western values
Cross Cultural approach to
understand entrepreneurial intention
 Hofstede (1980) defines culture as “collective programming of the mind which
distinguishes members of a human group from the another & includes system of values
 Values & norms formed early in life guide choices, attitudes & behaviour patterns
validates cultural consistency
 Culture acts as a powerful force to motivate individuals in a group or society to show
certain behaviours that may not be prevalent in other societies
 Research shows cultural context influences career decisions through social norms,
valuations & practices
 Entrepreneurial Culture enables entrepreneurial activities with a positive social approach
 Individualistic Cultures (US, UK, Australia) personal initiative, autonomy, achievement,
diversity & personal financial security are encouraged by society.
 Collectivistic Cultures (Turkey, China) Group interest override personal needs. Group
loyalty & group decision is rewarded, individual decision making, deviance in opinions or
behaviour is discouraged
 Individualistic Culture – Supportive & tolerant for self reliance, individual decision making,
diverse thinking & independent actions – individualism may facilitate intention for
entrepreneurial actions.
 Uncertainty avoidance – Culture members feel threatened by uncertain situations
Cross Cultural approach to
understand entrepreneurial intention
 Low uncertainty avoidance cultures – Members develop strategies to deal with inherent uncertainties
of life & there is a willingness to take risk.
 Greater tolerance for creative thinking & novel behaviour
 High Uncertainty avoidance Cultures – Uniformity is emphasized & social deviants as perceived as
different & with suspicion. Achievement – safety of life  greater fear of failure, lower willingness to
take risk & low ambiguity tolerance
 Low uncertainty avoidance culture fosters entrepreneurial traits like risk taking & optimism
 US Culture – emphasizes free choice, personal effort & initiative – independently motivated towards
self enhancement believing they can control & direct their own futures thus optimistic for future events
– social help & easily retrievable aid resources
 Easterners believe in fate accompany in determining their actions lack motivation to change it
 US Culture -> individualistic society -> low uncertainty avoidance culture supports entrepreneurship
 Turkey – Collectivist nation – high uncertainty avoidance culture – Turkish Culture doesn’t back self
reliance, autonomy, diversity or personal initiative  discourages creativeness & innovation in young
minds. Turkish society is on uniformity & obedience – educating child with family unit & in formal
education
Theoretical background & hypothesis:
Ajzen’s Theory of Planned Behaviour
Model
 Immediate antecedent of behaviour is intent to perform given behaviour
 Intentions define when assessing entrepreneurial behaviour
 Decision to become an entrepreneur is having an intention to start a new
business  deliberate and conscious decision that requires time, planning &
high degree of cognitive processing
 Entrepreneurial career decision  Planned behaviour explained by intentional
models – understanding entrepreneurship studying individual intents based on
socio-cognitive models – approach to analyse new venture creation
 Ajzen TPB model  intentions are determined by subjective norms, personal
attraction or attitude & perceived behavioural control
 Subjective norm means the perception family, friends or others would think
about entrepreneurial behaviour performance & approval/disapproval of
entrepreneurial decisions
 Attitude towards behaviour or personal attraction:
Ajzen’s Theory of Planned Behaviour
Model
 People develop attitudes based on beliefs they hold about consequences (intrinsic & extrinsic
rewards) on performing the behaviour
 Negative outcome like perceived risk weigh in unfavourable in intent to start a business
 Perceived Behavioural Control: Individual belief & confidence in his/her capability to perform as
an entrepreneur while realizing control & success in entrepreneurial activity
 Research scholars support entrepreneurial attitudes, subjective norms & perceived behavioural
control to predict entrepreneurial behaviour
 Shapreo & Sokol – Entrepreneurial Event Model (SEE) Assuming that intent to start business comes
from propensity to act & perception of desirability & feasibility determines personal choice
 Perceived Desirability: Degree to which one finds prospect of starting a business to be attractive
– Willingness to carry out this entrepreneurial activity is a combination of personal attitudes &
social norms in the TPB model
 Perceived feasibility: Individuals consider themselves personally capable of performing
entrepreneurial activity. Can be influenced by role models or partners, obstacles, financial &
social support, education etc.
Ajzen’s Theory of Planned Behavioural
Model

 Refined model by adding new variables like personal,


demographic & environmental factors  antecedents
of entrepreneurship behaviour
 Personality, social, environmental & cultural factors 
model to know how they contribute to entrepreneurial
intent & behaviour
Personality factor

 Personality traits
 Traits included which differentiates btw Turkish & US students due to cultural differences
 Optimism, innovativeness, risk taking propensity & competitiveness
 Optimism: Looking at brighter side of things & being positive on future. Positive emotions are
imperative for entrepreneurial activity.
 Optimism, hope & resilience are critical for successful leaders
 Innovativeness: Turning ideas & knowledge into new value via creative thinking. Ability and
tendency to think creatively while recognizing opportunities to produce novel & practical ideas
 Primary motive to start a new venture
 Risk Taking Propensity: Tendency to take or avoid risk. Greater risk acceptance  Stronger
entrepreneurial intention.
 Competitiveness: Personality trait related to new venture creation. Schumpeter stressed role for
competitiveness as major motivation. Need for achievement association.
Social Factors

 Experiential Activities: Experiences promote creative thinking & idea generation central to
innovation & new venture development – Creative Catalyst
 Experience like living in cities, travelling abroad, trying new foods, meeting new people of
diff cultures, exposure to foreign literature, movies & music can contribute to cognitive
diversity. Cognitive diverse can be more creative -- Page (2007)
 Exposure to others creativity also enhances creativity. Seelig (2012)ones immediate
surroundings greatly influences innovation & creativity
 Not living in an environment that rewards & stimulates the generation of new ideas 
unlikely creativity will flourish
 Exposure to nature also enhances creativity, Frumkin & Fox (2011) say that being in
contact with natural settings elicit a sense of wonder & fascination  disengaging from
normal thoughts while allowing mind to wander. Natural environments catalyse shift in
attitudes creating psychological space for creativity
 Entrepreneurship Education: Development & improvement of entrepreneurial inspiration,
awareness, knowledge & skills required to make & run a venture
Social Factors

 Literature on entrepreneurial education impact is quite contradictory &


polarized
 Some researchers claim people’s entrepreneurial inclination increases with
education contradicting while some say education lessens entrepreneurial
desire of an individual
 Negative aspect – Laukkanen (2000) business schools teach their students to
be analytic, problem conscious & risk averse scaring them to establish their
business ventures
 Entrepreneurial education  empower them to become enterprising thinkers
 Pruett (2009) main barrier for entrepreneurial intent amongst students is lack of
knowledge in management, business, accountancy & other administrative
topics. Enhance creativity, flexibility, & ability to respond to changing situations
meaning innovative behaviour
 Entrepreneurial family exposure: Influenced by immediate social environment
meaning closer links to family, friends or relatives
Social Factors

 Parents Vs Others or immediate family Vs Extended Family can


affect entrepreneurial intentions through attitudes
 Father or Mother play powerful role in creating desirability of
entrepreneurial behaviour
 Parental role model plays significant factor on entrepreneurial
intention
 Family business makes intergenerational influence on
entrepreneurial intention  Socialization process of children.
 Acquired skills, confidence & values required to do business
Societal Factors

 1. Economic & political condition of home country: Entrepreneurial


Intention & market oriented behaviour also be influenced by existing &
anticipated economic & political infrastructure in home country.
 Hostile economic environment
 IMD World Competitiveness Yearbook (2005) Criteria determining effective
on entrepreneurship performance of nations – ease of doing business,
venture capital availability for business development, political stability,
bureaucratic barriers etc.
 2. Cultural valuation of home country concerning entrepreneurship:
Cultural environment encourages or discourages entrepreneurial career
decision
 Positive societal attitude motivates entrepreneurs to start new ventures
Method

 Sample & Data Collection: Convenience sampling– enrolled Undergrads


junior & seniors at Washington University USA & Marmara University Turkey
 Selection of 2 universities is intentional -> better to study phenomena
before they occur
 Choosing subjects from depts, as interested to see influence of curriculum
on entrepreneurial intention
 US respondents aged btw 18-33 yrs old. Mean age: 21.67 with 31% Male &
69% female – 36% Junior Students – 64% Senior Students
 Turkish respondents aged between 20-33 yrs old. Mean age: 22.72. 42%
Male 58% Female; 13% Junior Students – 87% Senior Students
 Surveys were voluntary & anonymous
 Turkish Students – US Students 100% Turkish students while 289 US
Survey Instruments

 Career Path Survey


 English  Turkish
 Self-perception of their personal traits, their evaluation of social & environmental factors
along with their entrepreneurial intention
 Entrepreneurial intention & its antecedents – Subjective norm, personal attraction &
perceived behavioural control were measured by scales
 1= Strongly disagree to 6= Strongly agree – Subjective norm (2 items)
 Example: My immediate family values entrepreneurial activity above other activities &
careers
 Perceived Behavioural Control: (3 items) If I became an entrepreneur it would be likely
that my company will be successful in 2 years
 Personal attraction: (3 items) Idea of owning my business is very appealing to me
 Measured attractiveness of entrepreneur as a career  6 points Likert Scale (1= Very
Survey Instruments

 Entrepreneurial intention measured with 6 items (it is a high probability that ill start
own business in foreseeable future). Measured by nominal scale of 1=Yes or 2=No
 Students self-evaluated traits like optimism, innovativeness, risk taking propensity &
competitiveness on Likert scale  1= Strongly Disagree to 6= Strongly agree
 Optimism -> Assessed by 4 items from Life Orientation test
 Innovativeness was measured by an 8 item innovation scale from Jackson
Personality Inventory Manual
 Risk taking Propensity measured by 5 item reduced version of Risk Orientation
Questionnaire like I would rather like to be on safer side
 Competitiveness was measured by 5 item scale
 Experiential Activities measured by Likert & nominal scales. Students describe their
experiences
 Entrepreneurial education – 2 items scale of 1=Yes or 2=No --- 3 items likert scale
Survey Instruments

 Entrepreneurial Family Exposure: Dichotomous scale 1=Yes 2=No 2 items scale (2


item scale) like Do you have an immediate family member who has started a
business recently?
 Cultural Valuation: (5 items scale) Emphasising on culture specific regarding
entrepreneurship
 Present & future economic/political condition of home country: (4 items) Likert Scale
(1=Definitely worse) to (6= Definitely better)
 Demographic Questions: Age & gender
 Results: Data analysed by SPSS 22.0
 Employed factor analysis to check pre-conditions for cross-cultural comparisons are
met
 Factor analysis result shows all items in both data sets are significantly related to
hypothesized constructs
 2 exceptions  Innovativeness (Turkey) wasn’t related to factor measuring
innovativeness & was omitted
 Items measuring Risk taking Propensity didn’t appear under any factors & were
omitted
Results

 Turkish Data cumulative variance was 60.652%


 Risk Taking Propensity loading below 0.4 and was omitted from analysis
 US Data cumulative variance was 62.764%
 Cronbach alpha stats  English & Turkish scale versions were highly reliable good
measures with minimal variance
 Entrepreneurial intention: Mean Turkey 3.13 and US Mean 2.65  low intent
 Entrepreneurial attitude: US Mean 4.01 Turkish Mean 4.59High favourable attitude
 Risk Perception is high! (Mean US 3.83, Turkish mean 3.48, scale midpoint 3)
 75.7% US Students perceive a lot of & that too much risk is involved to start a business,
43.1% Turkish Students
 43% Turkish students – Moderately risky
 Pearson Correlation Analysis found Risk Perception & entrepreneurial intention is
negatively related for both samples
Discussion & Conclusion

 Investigating antecedents to entrepreneurial intention  start a business in 2 culturally


diverse sample climates
 US & Turkish Students showed relatively weak intention to start their own business
 Personal attitudes towards being an entrepreneur were though high!
 Cultural or other context responsible for this discrepancy
 US Students low level of entrepreneurial intent in comparison to Turkish Students was
puzzling. Reason  Perceived Risk due to new venture creation
 US students prefer private sector salaries if working in the entrepreneurial aspect
 Turkish Students low entrepreneurial intention  Unfavourable evaluation of economic
& political conditions discouraging them
 Ajzens TPB: Support association between entrepreneurial intention & subjective norms,
attitudes & perceived behavioural control
 TBP tested with Turkish data yielded low % change of 0.4 in explaining entrepreneurial
intention compared to 0.56 of US data. Ajzen works for a collectivistic cultural context
Discussion & Conclusion

 Subjective norm  weakest link of entrepreneurial intention with Turkish data


 Cultural factors  Other aspects influence entrepreneurial intention then
opinion of family & friends (Turkish Students)
 Turkish Students though scored higher on Ajzens antecedents of
entrepreneurial intention
 Stronger attitude for entrepreneurship, favourable familial valuation & high
perceived behavioural control
 Both US & Turkish Students scored avg in innovativeness, risk taking propensity,
optimism & competitiveness
 Cultural aspect: US Students had higher risk taking propensity
 Turkish Students had high dispositional optimism in comparison to US Students
 Optimistic outlook  see entrepreneurial challenges as opportunities
 High innovative score for Turkish Students. Caution over generalization
Discussion & Conclusion

 Turkish students scored high in competitiveness despite placing high on Hofstede


dimension of femininity – Turkish Culture values modesty, caring, quality of life & social
relationships then focus on competition, material success & ambition
 Recent research shows Turkey has become less hierarchial, less uncertainty avoiding &
moderately collectivistic
 Result show regardless of origin risk taking propensity & innovation leads to higher
entrepreneurial intention levels
 Creative Catalyst  Perceived innovativeness
 Exposure to arts, diff cultures & new experiences enhance cognitive diversity contributing
to perceived creativity
 Individual outdoor challenges, travelling, spending time in nature & art event attendance
contributes developing feeling of independence, self reliance and resilience.  traits
 Influence on education had mixed reviews on entrepreneurial intention
 Majority of American students didn’t even take up the course. Entrepreneurial intent is
lowest for American students then Turkish low
Discussion & Conclusion

 Parental role models an important aspect to increase entrepreneurial intention


 Pearson Correlation analysis – exposure to entrepreneurship (parents starting a business)
& their experiences’ perceived success was related to entrepreneurial intention for both
Turkish & US Students
 Family background – expressed strong intent to start their own business
 Certain business skills, confidence, vision & experience – learning
 Positive parental impact seems to be positive aspect!
 Present/Future economic & political condition of home nation: Turkish students were
unfavourable which showed their discouragement towards entrepreneurial intention
 Cultural variations: US Students consider their culture supportive for entrepreneurs.
 Turkish culture is unfavourable for entrepreneurial activity
 Lower intention of Turkish female then male  differences are consistent across nations
 Entrepreneurship is still regarded as a male dominated occupation
 Holistic view sought to understand entrepreneurial intention
Limitation of Study

 Focusing on antecedent of entrepreneurial intention 


sample of students is justified  cautious in assuming
causality as intentionality doesn’t lead to actual
behaviour
 Generalizing findings
 Personality traits measured by 4 constructs – don’t cover
entrepreneurial personality. Measurement choice is
debatable & can have a weak merit
 Future research should focus on other personality traits
& other contextual factors