The Effect of Regulatory Focus and Performance Feedback on Entrepreneurial Intention: A Simulation Experiment Study

Abstract

Entrepreneurship has gained a lot of theoretical and practical attentions. Adopting the research method of simulation experiments, this study explored the dynamic process and mechanisms of entrepreneurial decision-making, specifically the effect of regulatory focus and past performance feedback on the entrepreneurial intention. Using a sample of 64 MBA and business management majored students, we conducted a laboratory-based simulation experiment study. Based on the experiment data, we mainly took repeated measures variance analysis to test our hypothesis. The results indicate that, (1) The level of entrepreneurial intention under promotion focus situations is higher than that under prevention focus situations. (2) With a positive past performance feedback, the entrepreneurial intention is higher than that of negative past performance feedback. (3) Contextual regulatory focus and previous performance feedback have an interactive effect on the level of entrepreneurial intention; under the negative performance feedback, the gap of entrepreneurial intention between the promotion regulatory focus and prevention one is much wider, while under the positive performance feedback, the gap is relatively narrower. That is to say, under the positive performance feedback, the prevention regulatory focus group has experienced a greater increase in their entrepreneurial intention. Finally, the implication of these results are discussed as well.