Entrepreneurial role models, fear of failure, and institutional approval of entrepreneurship: A tale of two regions

Wyrwich, Michael and Stuetzer, Michael and Sternberg, Rolf (2016): Entrepreneurial role models, fear of failure, and institutional approval of entrepreneurship: A tale of two regions. Published in: Small Business Economics , Vol. 46, No. 3 (2016): pp. 467-492.

Abstract

Studies on the influence of entrepreneurial role models (peers) on the decision to start a firm ar-gue that entrepreneurial role models in the local environment (1) provide opportunities to learn about entrepreneurial tasks and capabilities, and (2) signal that entrepreneurship is a favorable career option thereby reducing uncertainty that potential entrepreneurs face. However, these studies remain silent about the role of institutional context for these mechanisms. Applying an ex-tended sender-receiver model, we hypothesize that observing entrepreneurs reduces fear of fail-ure in others in environments where approval of entrepreneurship is high while this effect is signif-icantly weaker in low approval environments. Taking advantage of the natural experiment from recent German history and using data from the Global Entrepreneurship Monitor Project (GEM), we find considerable support for our hypotheses.

• Item Type: MPRA Paper
• Language: English
• Keywords: Fear of failure, role models, peer effect, entrepreneurial intentions, Global Entrepreneurship Mon-itor, East Germany
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics; L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L26 - Entrepreneurship; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M1 - Business Administration > M13 - New Firms ; Startups; P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P20 - General; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R2 - Household Analysis > R23 - Regional Migration ; Regional Labor Markets ; Population ; Neighborhood Characteristics; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z13 - Economic Sociology ; Economic Anthropology ; Social and Economic Stratification

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