Persistence In Entrepreneurship Research Articles

Are shocks to entrepreneurship persistence? Case of a Resource-based economy

PurposeThis paper aims to investigate the stationary properties of entrepreneurship capital in the Iranian business sector. The investigation is conducted based on firm size (micro, small and medium, and large), sector (ISIC classification), and location (23 provinces) over the period 1981–2021.Design/methodology/approachTo achieve the purpose of the paper, we apply the Lagrange Multiplier (LM) unit root test with structural breaks.FindingsThe results of our study confirm the stationarity of entrepreneurship for the majority of our categorizations. Therefore, entrepreneurs' willingness to start a business is temporarily affected by sharp shocks, suggesting that the entrepreneurship trends in these categories will eventually revert to their long-run equilibrium. However, the time series of entrepreneurship in provinces such as Zanjan and Lorestan, as well as in the electrical machines and devices (code 31) sector, remain permanent. These findings can assist policymakers in each sector and location in designing effective policies to promote entrepreneurial activities.Research limitations/implicationsIn this study, the time period utilized was restricted, and there were no data accessible for an extended duration. Another limitation of this research is the absence of access to firm-level data on a shorter time scale, such as weekly or monthly.Originality/valueThe economic literature reveals that empirical studies on the persistence of entrepreneurship have received relatively less attention in the context of emerging and resource-based economies, compared to the increasing focus on them in developed countries. Therefore, to address this gap, this paper aims to extend the current empirical literature by presenting new evidence for the case of Iran, which has an emerging and resource-based economy.

Career shock and the impact of stress, emotional exhaustion, and resources on entrepreneurial career commitment during the COVID-19 pandemic

PurposeThe purpose of this study is to investigate how a career shock, like the COVID 19 pandemic, decreases entrepreneurial career commitment (ECC). The authors look at the specific effect of career shock on stress and emotional exhaustion mediating the commitment, and how organizational and relational resources offset the shock to keep the entrepreneurs committed to their career.Design/methodology/approachThis study used a two-wave sample of 365 entrepreneurs collected four months apart. The authors initially recruited entrepreneurs three months after the pandemic started, then four months later, and tested these ideas with longitudinal data. The design was informed by the stress-strain-outcome (SSO) model to investigate career shock as stressors to entrepreneurs that are likely to produce emotional exhaustion and a decline in ECC.FindingsThe findings demonstrate that career shock affects stress, which in turn leads to a decline in commitment through the mediation effect of emotional exhaustion. Organizational resources (e.g. access to finance) do not impact ECC, stress or emotional exhaustion. However, relational resources (e.g. quality emotional support) are important for ECC by supporting a decrease in stress and emotional exhaustion.Research limitations/implicationsThis study makes three main contributions. Firstly, it advances career shock research in entrepreneurship, emphasizing its role in explaining entrepreneurial career commitment through stress-strain mediation. Secondly, it adds to the understanding of entrepreneurial career commitment and its impact on persistence in entrepreneurship and entrepreneurial exit. Lastly, it supports the relevance of the Stress-Strain-Outcome model in entrepreneurship, demonstrating how career shock can decrease entrepreneurial career commitment through stress and emotional exhaustion. Further research is needed to explore the interaction of career identity and career planning in maintaining career resilience amidst career shocks.Practical implicationsThis study has practical implications for policymakers and service providers in entrepreneurship. It highlights the significance of resources, particularly relational resources, in maintaining psychological health and entrepreneurial career commitment (ECC). The findings support the importance of the Stress-Strain-Outcome (SSO) model in entrepreneurship, emphasizing the need for entrepreneurs to have access to relational resources as coping mechanisms. Policymakers and service providers should focus on enhancing entrepreneurs' capacity to acquire, protect, and develop relational resources. Additionally, the study suggests that entrepreneurs should seek access to both relational and organizational resources to effectively navigate career shocks, such as the pandemic. Further research is needed to explore the role of other types of resources, such as social capital and psychological capital, in entrepreneurial well-being and persistence.Originality/valueThis study demonstrates that a career shock affects stress, which in turn leads to a decline in commitment only through the mediation effect of emotional exhaustion. The panel/longitudinal data analysis demonstrates the causality in the process, highlighting the positive role of the entrepreneur's relational resources. Specifically, it shows that an increase in access to relational resources causes a decrease in stress and emotional exhaustion, which in turn causes ECC to improve. Entrepreneurs are ill-equipped to face a career shock if they lack these resources.

Long-term persistence in entrepreneurship: the case of post-socialist Czechia (1930–2011)

ABSTRACT This paper explores the long-term persistence of interregional differences in self-employment rates. The analysis, based on spatial Durbin error models, was performed for 206 Czech regions from 1930 to 2011. The results obtained supported the ‘persistence claim’ because regional self-employment rates in 1930 were found to be positively and significantly associated with those obtained in 1991, 2001 and 2011. Moreover, this study contributes to the knowledge about transmission channels of historical entrepreneurial experience. First, a new mechanism related to the career and educational paths of individuals with a pre-socialist entrepreneurial family background is suggested. Second, the newcomers’ capacity to absorb knowledge and skills is emphasized as crucial for the functioning of pre-socialist ‘entrepreneurial memory’.

Historical roots of innovative entrepreneurial culture: the case of Italian regions

ABSTRACT This paper investigates persistence in entrepreneurship across Italian provinces over the period 1927–2017. We distinguish between a ‘general’ dimension (sociopsychological) and a ‘specific’ dimension (learning) of the role model effect. Based on data obtained from a comprehensive survey conducted in 1927 by the Italian National Statistical Institute, we find different drivers of persistence across sectors: the only driver of persistence in high-technology sectors is the share of entrepreneurs using motive power (‘specific’ role model effect), while the share of industrial entrepreneurs (‘general’ role model effect) is an important driver of persistence in low-technology manufacturing and service sectors.

Why I persist while others leave? Investigating the path from passion to persistence in entrepreneurship

ABSTRACT Although research affirms that entrepreneurial passion (EP) is an important predictor of entrepreneurial persistence, much less is known of the underlying processes through which EP leads to entrepreneurial persistence. Drawing upon the broaden-and-build theory of positive emotions, this study uncovers the mediating effects of entrepreneurial self-efficacy (ESE) and the moderating role of proactive personality between the relationship of EP and entrepreneurial persistence. The results of survey data from 215 small firms in China demonstrate that ESE mediates the link between EP and entrepreneurial persistence. The proactive personality of an entrepreneur also strengthens the direct relationship between EP and ESE and the indirect relationship between EP and entrepreneurial persistence via ESE. The findings contribute to the literature on entrepreneurs’ proactive personalities, ESE and entrepreneurial persistence.

Regulatory focus, persistence and new venture performance

PurposeThe purpose of this paper was to examine the joint effects of regulatory focus, entrepreneurial persistence and institutional support on new venture performance.Design/methodology/approachThis paper uses a random survey approach to sample 204 new ventures from Ghana. The moderated mediation method was used to analyse the survey data.FindingsThe findings from this paper show that entrepreneurs' promotion focus positively relates to persistence while prevent focus negatively influences persistence. In addition, persistence mediates the link between regulatory focus (promotion and prevention focus) and new venture performance. These relationships are positively moderated by perceived institutional support.Research limitations/implicationsUsing data from only the manufacturing sector in Ghana limits the generalisability of this paper. In addition, persistence is not observed or measured directly in this paper but is only used as self-reporting variable that captures an individual's tendency to persist.Originality/valueThe contribution of this paper is threefold. First, this paper contributes to regulatory focus literature by enhancing our knowledge on how self-regulation could help explain entrepreneurial decision-making. Second, this paper broadens self-regulation literature by adding institutional context as a moderating variable. Third, this paper helps clarify the potential role of persistence in entrepreneurship.

Embracing Failure: A Socio-Computational Analysis of Entrepreneurial Failure Narratives

Public peer-to-peer entrepreneurial failure narratives (PPEFNs) attempt to make sense of the unexpected and re-position the fallen. Yet, these narratives are paradoxical in that they expose the author to stigmatization. This study investigates how authors of PPEFNs navigate the tension between sensemaking and stigma to persist in entrepreneurship. I test the argument that entrepreneurs avoid peer stigma through rhetoric that externalizes failure, which should destigmatize their failure experience and help them to recover their social capital. I apply inductive computational text analysis and correspondence analysis to data from PPEFNs published on blogging platform Medium.com to analyze how entrepreneurs talk about failure and how peers react to these rhetorics. I combine this with LinkedIn data to identify whether narrators continue in entrepreneurship. I find evidence to support the initial argument that externalizing rhetoric results in destigmatization. But I also find evidence that entrepreneurs turn to internalizing rhetoric to claim the entrepreneur identity, which may be even more important for persistence in entrepreneurship. These findings suggest that positive peer response may play a role in entrepreneurial persistence, by providing an empathetic support network that connects failed entrepreneurs to social capital.

Cultural transmission and persistence of entrepreneurship

This paper contributes to explain the persistence of differences in levels of entrepreneurship within and across countries. We provide an explanation based on the dynamic interplay between purposeful intergenerational transmission of preferences for entrepreneurship and public administration efficiency. Individuals vote on taxes, and the collected taxes fund the civil servants’ wages. The performance of the administration generating an efficient normative and regulatory environment, affects the success of entrepreneurship. We show that an economy can reach two different long-run equilibria: a traditional equilibrium, with a low proportion of entrepreneurs, high taxes and an inefficient administration and, an entrepreneurial equilibrium with a high proportion of entrepreneurs and, lower taxes but enough to implement an efficient administration. The equilibrium achieved depends on the tax policy followed by the different generations. If decisions are made by majority voting in a myopic way, then the initial conditions of the society become crucial. This result explains persistence: an economy evolves around similar levels of entrepreneurship unless some reforms are implemented.

The persistence of entrepreneurship and innovative immigrants

Ethnicity and immigration status may play a role in entrepreneurship and innovation, yet the impact of university entrepreneurship education on this relationship is under-explored. This paper examines the persistence and differences in entrepreneurship by ethnicity and nationality. We find that among Stanford alumni, Asian Americans have a higher rate of entrepreneurship than white Americans. However, non-American Asians have a substantially lower, about 12% points lower, start-up rate than Asian Americans. Such discrepancy not only holds for entrepreneurial choice but also for investing as an angel investor or venture capitalist, or utilizing Stanford networks to find funding sources or partners. Participation in Stanford University’s entrepreneurship program as a student does little to reduce this gap. The low level of parental entrepreneurship and the high degree of intergenerational correlation in entrepreneurship likely result in the lower level of entrepreneurship and participation in university entrepreneurship programs among Asians relative to their Asian American counterparts. Our findings highlight the value of immigration in terms of breaking the persistence in entrepreneurship among certain ethnic groups and promoting potential high-growth entrepreneurship in the United States. In addition, our findings may have important implications for programs to incorporate immigrant entrepreneurs within their home countries to promote entrepreneurship and help break the persistence of entrepreneurship across generations.

Business Area Changes and Entrepreneurial Persistence in Ecology- and Food-Related Industries: Knowledge Heterogeneity and Emotion Perspectives

Entrepreneurs’ changes to different business areas can be viewed as shifts in entrepreneurial knowledge domains (e.g., from restaurant to food waste processing firm as an ecological helping business). From a sample of 73 representative entrepreneurs, we present a study of the impact of such area changes on the persistence of entrepreneurship (i.e., the degree an entrepreneur remains in entrepreneurial activities). Furthermore, two mediators, managerial experience and insecurity, and two moderators, positive and negative affect, were proposed and examined to make a more comprehensive theoretical inference of the relationship between area difference and persistence. The results revealed that, counter-intuitively, area difference was significantly and positively associated with entrepreneurial persistence. The mediation effects of managerial experience and psychological insecurity were also confirmed. However, only the moderation of positive affect was effective. Based on the knowledge heterogeneity and entrepreneurial emotion perspectives, academic and practical implications for inter-temporal dynamics of entrepreneurship are discussed.

The Persistence of Entrepreneurship and Innovative Immigrants: Evidence from Stanford University

Ethnic and immigration status may play a role in entrepreneurship and innovation, yet the impact of university entrepreneurship education on this relationship is under-explored. This paper examines the persistence and differences in entrepreneurship of Stanford Alumni by ethnicity and nationality. We find that among Stanford alumni, Asian Americans have a higher rate of entrepreneurship than white Americans. However, non-American Asians have a substantially lower, about 12 percentage point, start-up rate than Asian Americans. Such discrepancy not only holds for entrepreneurial choice but also for investing as an angel investor or VC, or utilizing Stanford networks to find funding sources or partners. Participation in Stanford University’s entrepreneurship program as a student does little to reduce this gap. The low level of parental entrepreneurship and the high degree of intergenerational correlation in entrepreneurship likely result in the lower level of entrepreneurship and participation in university entrepreneurship programs among Asians relative to their Asian American counterparts. Our findings highlight the value of immigration in terms of breaking the persistence in entrepreneurship among certain ethnic groups and promoting potential high-growth entrepreneurship in the United States. In addition, our findings may have important implications for programs to incorporate immigrant entrepreneurs within their home countries to promote entrepreneurship and help break the persistence of entrepreneurship across generations.

Seeking the Roots of Entrepreneurship: Insights from Behavioral Economics

In this article, we critically evaluate what the existing research shows regarding the individual determinants of entrepreneurship. We begin by documenting a set of facts that seem to pose a challenge for interpretations of entrepreneurship based on the standard expected utility framework. Drawing on research in behavioral economics we then review three sets of possible interpretations — risk aversion, overconfidence, and non-pecuniary, taste-based factors — for understanding the empirical facts related to the entry into, and persistence in entrepreneurship. The central thesis of this article is that while all these candidate explanations have merit and can account for some aspects of the facts above, there is little evidence of a “smoking gun” that can completely account for all the puzzling patterns we observe.

Persistence in Entrepreneurship and its Implications for the European Entrepreneurial Promotion Policy

By considering entrepreneurs who hire employees and own-account workers as related but distinct groups within self-employment, this work analyzes the roles of different factors in self-employment survival in Europe from a new perspective: contrasting the determinants of own-account self-employment survival with those affecting employers’ survival in the EU-15. Our results confirm the presence of persistence in entrepreneurship. However, we also obtain a strong negative effect on survival of entering self-employment from unemployment. Hence, policymakers should balance these mixed results to evaluate the medium- and long-term suitability of the existing entrepreneurial promotion policy across European regions.

Persistence in entrepreneurship and its implications for the European entrepreneurial promotion policy

By considering entrepreneurs who hire employees – employers – and entrepreneurs without personnel – own-account workers – as related but distinct groups within entrepreneurship, this work analyzes the roles of different factors in entrepreneurship survival in Europe from a new perspective: contrasting the determinants of own-account workers’ survival with those affecting employers’ survival in the EU-15. Our results confirm the presence of persistence in entrepreneurship. However, we also obtain a strong negative effect on survival of entering entrepreneurship from unemployment. Hence, policymakers should balance these mixed results to evaluate the medium- and long-term suitability of the existing entrepreneurial promotion policy across European regions.

The Shadow of the Past:Examining the Influence of Prior Founding Experience on Later Venture Success

Recent studies on entrepreneurial firms have yielded conflicting results pertaining to the influence of prior entrepreneurial experience on subsequent performance of firms founded by serial entrepreneurs. While some scholars have emphasized the positive results from learning-by-doing and learning from failure on subsequent performance, other scholars have found evidence of performance persistence in entrepreneurship wherein successful entrepreneurs show a high likelihood of succeeding again in later entrepreneurial ventures whereas unsuccessful entrepreneurs do not significantly improve their odds of subsequent success vis-à-vis novice entrepreneurs. In this paper, we unpack and explore various contingencies pertaining to the influence of prior entrepreneurial experience and taking a contingency perspective, offer a more nuanced understanding of the influence of prior entrepreneurial experience and its implications for later venture performance. We combine insights from the literatures on learning, social capital and entrepreneurship to provide a more complete understanding of the ways and means by which experiential knowledge is translated into performance of later ventures founded by serial entrepreneurs.

Gendered Institutions and Women’s Persistence in Entrepreneurship

Macro-level variables that can influence the effects of individual-level factors on women’s economic behavior have rarely been examined with regard to women’s entrepreneurship. Three important gaps...

Persistence and survival in entrepreneurship: The case of the wave energy conversion corporation of America

Many entrepreneurial firms risk falling into a cash flow “Valley of Death”‐the stage of a young firmʼs life when seed funding is running dry but the firm has yet to secure sufficient additional funding to carry it through to product commercialization.This is particularly true in the nascent cleantech sector, where investments are often complex and capital intensive. Drawing on an in-depth interview with seasoned entrepreneur Brian Cunningham, CEO of the Wave Energy Conversion Corporation of America, this article explores the role of persistence in entrepreneurship, distinguishing between “calculated” and “blind” persistence.

Persistence in Entrepreneurship With and Without Personnel: The Role of Human Capital and Previous Unemployment

By considering entrepreneurs who hire employees – employers – and entrepreneurs without personnel – own-account workers – as related but distinct groups within entrepreneurship, this work analyzes the roles of different factors in entrepreneurship survival from a new perspective: contrasting the determinants of own-account workers’ survival with those affecting employers’ survival. Toward this end, discrete choice models under competing risks frameworks are applied to data drawn from the European Community Household Panel for the EU-15 (EUROSTAT). Our results suggest that survival chances are markedly higher for employers than for own-account workers, especially when non-employment exits are considered. We also observe that high qualifications have positive and statistically significant effects on survival rates of employers, whatever exit route, while have no significant effect on survival of own-account workers. Finally, we find that entering entrepreneurship (with and without personnel) from unemployment – i.e., the target group for entrepreneurship incentives – strongly increases the probability of switching back to unemployment. Thus, entrepreneurship and higher education policies should be considered together in order to develop high quality entrepreneurial businesses.

High-Tech Entrepreneurship

Schumpeterian entrepreneurship is particularly prominent in high-tech industries where new ideas generated from advanced knowledge are of great importance. But case studies notwithstanding, the data used to analyze entrepreneurship have been dominated by startups in low-growth, low-tech industries. In this paper, we use a novel data set on scientists and engineers and a novel strategy in which we pare down the sample to those whose jobs are related to their education to better identify potential high-tech startups. We develop a simple model in which entry into and rewards from entrepreneurship are determined by the interaction of ability, the quality of the entrepreneurial idea, and experience in employment. The model yields distinctive implications about how labor market experience and earnings at work influence the probability of a high-tech worker becoming an entrepreneur, earnings as an entrepreneur, and persistence in entrepreneurship. Consistent with the model, we find that younger entrepreneurs are more likely to come from the upper tail of the paid wage distribution and that more pre-entry labor market experience is associated with better chances of continuing as an entrepreneur but also with lower earnings in entrepreneurship.

Performance persistence in entrepreneurship

This paper presents evidence of performance persistence in entrepreneurship. We show that entrepreneurs with a track record of success are much more likely to succeed than first-time entrepreneurs and those who have previously failed. In particular, they exhibit persistence in selecting the right industry and time to start new ventures. Entrepreneurs with demonstrated market timing skill are also more likely to outperform industry peers in their subsequent ventures. This is consistent with the view that if suppliers and customers perceive the entrepreneur to have market timing skill, and is therefore more likely to succeed, they will be more willing to commit resources to the firm. In this way, success breeds success and strengthens performance persistence.