Entrepreneurship Born Made Educated i To

ENTREPRENEURSHIP – BORN, MADE AND EDUCATED

Edited by Thierry Burger-Helmchen

ENTREPRENEURSHIP – BORN, MADE AND EDUCATED Edited by Thierry Burger-Helmchen

Entrepreneurship – Born, Made and Educated Edited by Thierry Burger-Helmchen

Published by InTech Janeza Trdine 9, 51000 Rijeka, Croatia Copyright © 2012 InTech All chapters are Open Access distributed under the Creative Commons Attribution 3.0 license, which allows users to download, copy and build upon published articles even for commercial purposes, as long as the author and publisher are properly credited, which ensures maximum dissemination and a wider impact of our publications. After this work has been published by InTech, authors have the right to republish it, in whole or part, in any publication of which they are the author, and to make other personal use of the work. Any republication, referencing or personal use of the work must explicitly identify the original source. As for readers, this license allows users to download, copy and build upon published chapters even for commercial purposes, as long as the author and publisher are properly credited, which ensures maximum dissemination and a wider impact of our publications. Notice Statements and opinions expressed in the chapters are these of the individual contributors and not necessarily those of the editors or publisher. No responsibility is accepted for the accuracy of information contained in the published chapters. The publisher assumes no responsibility for any damage or injury to persons or property arising out of the use of any materials, instructions, methods or ideas contained in the book. Publishing Process Manager Marina Jozipovic Technical Editor Teodora Smiljanic Cover Designer InTech Design Team First published March, 2012 Printed in Croatia A free online edition of this book is available at www.intechopen.com Additional hard copies can be obtained from [email protected]

Entrepreneurship – Born, Made and Educated, Edited by Thierry Burger-Helmchen p. cm. ISBN 978-953-51-0210-6

Contents Preface IX Part 1

The Psychology of Entrepreneurship 1

Chapter 1

The Psychology of Entrepreneurship 3 Melek Kalkan and Canani Kaygusuz

Chapter 2

Entrepreneurial Intentions: The Role of the Cognitive Variables 27 José C. Sánchez

Chapter 3

Do External Factors Influence Students’ Entrepreneurial Inclination? An Evidence Based Approach 51 Ishfaq Ahmed, Muhammad Musarrat Nawaz and Muhammad Ramzan

Chapter 4

Reflections on Eco-Preneurship Alan E. Singer

Part 2

59

Academia and Entrepreneurship 75

Chapter 5

The Effect of an Entrepreneurial Training Programme on Entrepreneurial Traits and Intention of Secondary Students 77 Ricardo Gouveia Rodrigues, Anabela Dinis, Arminda do Paço, João Ferreira and Mário Raposo

Chapter 6

Academic Entrepreneurship and Financial Problems: The Capital Structure of the University Spin-Offs 93 David Rodeiro, Sara Fernández, Milagros Vivel and María Jesús Rodríguez

Chapter 7

Entrepreneurship Education and Pupils' Attitudes Towards Entrepreneurs 113 Vegard Johansen, Tuva Schanke and Tommy Høyvarde Clausen

VI

Contents

Chapter 8

Entrepreneurship, University Research, and Growth: European North vs. South 127 Panagiotis E. Petrakis

Chapter 9

Academic Entrepreneurship: What Changes When Scientists Become Academic Entrepreneurs? 159 Igor Prodan and Alenka Slavec

Chapter 10

University's Entrepreneurship Education: Creating Meaningful Impression for New Generation 175 Muhammad Nizam Zainuddin

Chapter 11

Critical Development Paths of University Spinoff Venture 199 Philip Bowe and Rory O’Shea

Chapter 12

Fostering Entrepreneurship by Developing a New Learning Environment Within a Finnish University of Applied Sciences 225 Pasi Juvonen

Part 3

Macro Effects of Entrepreneurship 247

Chapter 13

Entrepreneurship and Economic Growth: Macroeconomic Analysis and Effects of Social Capital in the EU 249 Marta Portela, Emilia Vázquez-Rozas, Isabel Neira and Elvira Viera

Chapter 14

Types of Entrepreneurial Action and Societal Provision for the Future: An Inquiry 265 John Brätland

Chapter 15

Examining the Bidirectional Relationship Between Entrepreneurship and Economic Growth: Is Entrepreneurship Endogenous? 283 Maribel N. Mojica-Howell, Wesley L. Whittaker, Tesfa G. Gebremedhin and Peter V. Schaeffer

Chapter 16

Entrepreneurs’ Resilience Measurement 317 Nor Aishah Buang

Preface The birth and infancy of entrepreneurship was turned into a specific area of academic study and empirical research quite early. The field greatly evolved, and at the same time, a constant urge to deal with real problems existed, from firm creation to industrial growth, including firm strategy and economic policy. Economic, sociological, and managerial academics began to devise a detailed and interpretative framework for the study of entrepreneurship. Many people came from different fields, and there was a need to overcome the limitation of the standard neoclassical theory of entrepreneurship. New areas of research were embraced, thereby recognizing that powerful mechanisms are at work in entrepreneurship and require systematic analysis. The economics of entrepreneurship Entrepreneurship, in a very broad sense, has always been at the heart of firm and industrial dynamics extoling it's influence at macro level. Starting with the analysis of the specific properties and effects of entrepreneurship as an economic function, researchers then proceeded to the historical and normative analysis of resource allocation mechanisms in the field of entrepreneurship. More generally, they analyzed the socio-economic institutions that could be relied upon to produce, mediate, and favor entrepreneurship. Many authors tried to define Entrepreneurship: “Entrepreneurship is an act of innovation that involves endowing existing resources with new wealth-producing capacity” Drucker (1985) “Entrepreneurship is a process by which individuals pursue and exploit opportunities irrespective to the resources they currently control” Stevenson (1985) “Entrepreneurship is the creation of organizations, the process by which new organizations come into existence“ Gartner (1988)

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Preface

“Entrepreneurship is a way of thinking, reasoning, and acting that is opportunity drive, holistic in approach, and leadership balanced” Timmons (1997) “Entrepreneurship is about how, by whom, and with what consequences opportunities to bring future goods and services into existence are discovered, created and exploited” Venkataraman (1997) From these definitions, we can see that the academic understanding of entrepreneurship broadened over time. The first dimension of the entrepreneurial space is the continuum between economic approaches oriented towards the origin and context of entrepreneurship, social science approaches, and managerial concerns. Among others, influences can also be found in the education context, or, the institutional context. And finally, researchers raised the question of what happens if we do not take those issues into account? What if we take them for granted and simply state that entrepreneurs do things differently, for whatever the reason, and have ideas in different ways other than economic factors? The following table summarizes these three divisions of research in entrepreneurship. Approaches Classical economic and social context

Education, development and institutional context Where Why Description of the The entrepreneur is an Is one a born entrepreneur, important element of entrepreneur? Does object of the study: macro and local one become an development. The entrepreneur through impact can depend on a specific education gender, geographical system or a special location and social institutional context? context.

Sectors of interest: Political level (country, Educational system, region, town level) historical studies, political influence

Managerial context How The entrepreneurial process, the detection of opportunities, the development of ideas, creativity, and innovation. The construction of new business models Economists involved in theory of the firm, management science

Preface

The three volumes of entrepreneurship are each dedicated to one of the above divisions. The first volume “Entrepreneurship - Gender, Geographies and Social Context” sheds new light on how the entrepreneur is an important element of macro and local development by taking into account gender, geographical places, and social context. The second volume “Entrepreneurship - Born, Made and Educated” raises the question why some human beings turn into great entrepreneurs. Is it a gift of Mother Nature, or the outcome of a specific education system or from other institutional construction? The last volume “Entrepreneurship - Ideas, Creativity and Innovative Business Models” is more managerial oriented and takes into account the detection of opportunities, the creative processes, and the impact of the entrepreneurial mindset on business models. Entrepreneurship - Born, Made and Educated This book is divided in three sections. Section I: The Psychology of Entrepreneurship is composed of five articles exploring the psychology of entrepreneurship, the entrepreneurial intention, the reaction of entrepreneurs in hostile situations, and the possible measure of entrepreneurship in such contexts. The question of how entrepreneurs are educated and how academic programs and efforts can influence the outcome of entrepreneurship is at the center of Section II: Academia and Entrepreneurship. Those eight contributions cover the educational system from the younger kids to the highest academic level in different countries. The final four papers form Section III: Macro Effects of Entrepreneurship. Those papers try and answer the question of the effect of entrepreneurship on the aggregate level.

Thierry Burger-Helmchen BETA-CNRS, EM Strasbourg, University of Strasbourg France References Drucker, P F. 1985. Innovation and Entrepreneurship: Practice and Principles. New York, USA: HarperBusiness.¨ Gartner, W. 1988. “Who is an entrepreneur ? Is the wrong question ?”, American Journal of Small Business, 12, pp.11-31. Stevenson, H. 1985. “The Heart of Entrepreneurship.” Harvard Business Review, MarchApril, pp. 85-94. Timmons, J.A. 1989. The Entrepreneurial Mind. Brick House Pub.

XI

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Preface

Venkataraman, S. 1997. “The Distinctive Domain of Entrepreneurship Research: An Editor's Perspective”. Advances in Entrepreneurship. J. Katz and R. Brockhaus. Greenwich, JAI Press. pp.119-138.

Part 1 The Psychology of Entrepreneurship

1 The Psychology of Entrepreneurship Melek Kalkan and Canani Kaygusuz

Ondokuz Mayıs University Turkey

1. Introduction 1.1 Psychological perspectives on entrepreneurship For the last fifty years, social history has witnessed a transformation that was not experienced in any period before. The facts that how people are affected and through what sort of characteristics individuals try to handle this situation has been a multi-perspective issue and was studied thoroughly. Understanding intersocietal and interpersonal relationship systems that are based on fluctuation and competition was aimed and studies were carried out to determine what characteristics that individuals had in order to survive in this period. For over thirty years, the role of entrepreneurship in dealing with competition has drawn researchers’ extensive interest. In spite of this, the concept of entrepreneurship hasn’t had an operational definition that everyone agrees on because it is multi-dimensional and it is affected by many variables. Although entrepreneurship is mostly associated with the fields of administration, management and economy, in fact it is an interdisciplinary subject. Entrepreneurship and enterprise as being a broad subject and conceptual field was studied within the field of psychology, at least at the beginning, more than the fields of economy, administration and management. The studies of psychology over entrepreneurship have played an important role for a detailed consideration of the concept and in giving the concept the broader meaning that is used now. One of the first studies of psychology over entrepreneurship was conducted by Mc Clelland, Atkinson and Feather in the second half of twentieth century. According to them, the motivation of individual and society is one of the most important factors that explain entrepreneurship and individual’s becoming an entrepreneur depends on the highest possibility of achievement (Korpysa, N.d). In other words, when the possibility of achievement gets higher, entrepreneurial propensity rate increases. Studies in the field of psychology have focused on the details of the factors that play a role in entrepreneurship’s achievement (Baron, 2000).These studies stated that entrepreneurial ability of individual is connected with societies’ perception of success and to what extent individuals are affected by this perception. However, even if it was stated that culture influence entrepreneurship, it was observed that individual differences have important effects on entrepreneurship despite cultural commonality. Psychology’s extensive interest for the subject matter of entrepreneurship at the beginning is closely associated with periodic interest to understand psychological dynamics of human

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behaviors. Studies that were focused over people’s relationships with enterprises and organizations realized that not only enterprises affect individuals, but also individuals affect enterprises. Therefore, when the characteristics of individuals were studied, it was wondered whether individuals with entrepreneurial characteristics affect enterprises more strongly so they looked for an answer for the question of “Who is the entrepreneur?” In this process, the data about entrepreneurship that psychology obtained became popular and the relationship between entrepreneurship and the characteristics like risk-taking, uncertainty avoidance, power distance, need for achievement and risk-management has been studied. However, although psychology was in the first place in the development of entrepreneurship research, later using the findings of psychology in understanding entrepreneurship was abandoned. The fact that research that has been carried out in psychology field is often limited by character approaches and over-emphasis of the effects of personality over the consequences played a role in this divergence. However, in later years the picture changed again and empirical studies that put forward the importance of psychological variables increased. From then on studies over the characteristics of individual with entrepreneurial qualities and entrepreneurship culture have become widespread and research over entrepreneurship in the field of psychology has become the focus of interest again. When we consider it in general, it is possible to analyze the studies over entrepreneurship that psychology carried out and emphasized individual traits in two groups. One group of these studies has looked for a connection between entrepreneurship and personal characteristics and proved that individuals with entrepreneurial qualities are self-controlled, self-confident and competitive people. They also have a great imagination and they do not avoid risks. Another group of study examined motivation resources of entrepreneurial individual and has discovered that entrepreneurship is nurtured by sources such as motivation for achievement, power distance and willingness for taking risks. Besides, the studies that focused on entrepreneurship’s relationship with culture try to uncover cultural resources that nurture and weaken entrepreneurship; therefore, entrepreneurship is also studied as an issue that draws socio-psychology’s attention.Nowadays, entrepreneurship research continues by making associations with psychological variables like cognitions, emotions, perceptions, behaviors and motivation and the effects of psychological variables over entrepreneurship cannot be ignored. Even if different countries seem to have different development policies, especially since 1980s, entrepreneurship has become more important due to competitive development program that countries have to apply because of neo liberal development policies. The fact that societies have to increase their share in international markets or maintain their own national markets depends on the existence of human resources who have entrepreneurial characteristics to a certain extent. Determining methods and details of training programs to educate entrepreneur individuals has become very important for social development so multidimensional analysis of entrepreneurship has also become more important. In this context, entrepreneurship is not a research field of general psychology anymore. It has become the subject matter of subfields of psychology and organizational psychology started to study entrepreneurship (Frese, 2009). As a result of entrepreneurship research which has been carried out in various different contexts, psychology tend to define entrepreneurship as an individual behavior or attitude with a tendency to challenge and it has said that it creates new facts and

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circumstances and improves existing conditions. A new field among subfields of psychology has started and has been defined as entrepreneurship psychology. Entrepreneurship psychology indicates many intersection points between industrial/organizational psychology and entrepreneurship. First of all, organizations which are the central phenomenon of organizational psychology exist by means of entrepreneurship and entrepreneurs. Organizations have to renovate themselves regularly so as to continue their own existence and in order not to be destroyed by their competitors who aimed at the same targets in tough market conditions. Providing this renovation is only possible by watching over the possibilities and opportunities in the market. Therefore, some of the individuals in every organization must have entrepreneurial skills such as innovative thinking, creative, risk-taking, and powerful future design; they also have to be bold and self-confident. One of the main elements in this kind of organization is entrepreneurship. This process leads industrial/organizational psychology researchers to study entrepreneurship process. Many of the founders of business enterprises are not good managers because it is usual that people who have essential capital and a certain vision about the future of the organization can not make good managers at the same time. In other words, being the founder of an organization/enterprise does not require having the skills of a good manger. Therefore, it is important to search essential qualities to predict success of the organization and to increase its competitive power in its own field and it is also important to find individuals with these qualities and provide their connections with these organizations as executives. This situation has become a factor that leads organizational psychology to be interested in entrepreneurship field. Once again, both organizational and entrepreneurial studies have focused on performance results. Thus, the fact that both research fields focused on performance results showed that they had common subject areas and this deepened psychology’s interest in entrepreneurship. Psychologists evaluate performance in terms of supervisory judgments whereas entrepreneurship evaluates it in terms of market performance. Both fields’ findings are needed to determine entrepreneurial performance. Almost all of the measurements, which are used to determine entrepreneurial characteristics like coping with stress, motivation, ability and knowledge, are carried out by using psychological assessment tools or the instruments which are developed by their methods. This situation has played a role in the intersection of psychology and entrepreneurship research. In conclusion, psychologists can be interested in the concepts of new characteristics such as motivation for achievement or big five personality that entrepreneurship research has discovered (Baum, Frese & Baron, 2007). As a consequence, psychological approaches towards entrepreneurship are important for both psychology and entrepreneurship. In fact, psychological variables undertake the role of mediators through the process that leads entrepreneurial individuals to success (The_psychology_of_entrepreneurship.pdf).

2. Cognitive process of entrepreneurial thinking There are not enough empirical studies to make clear connections between entrepreneurship and cognition because studies in this field are quite new. Cognition studies aim to understand how to achieve substantial learning mostly in order to see opportunities. It is

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known that learning and personality are shaped through and within the culture. In researches that were done over entrepreneurial personality, it has been discovered that culture is one of the factors that determine entrepreneurship; and this discovery increased the interest towards the relationship between cognitive process and entrepreneurship. The question of whether these similarities of people who show similar behavioral responses towards an incident despite their cultural differences associated with cognitive process has been asked more often recently. Before that, while entrepreneurial culture and entrepreneurial personality characteristics as the main factors that affect entrepreneurship came to the forefront, recently cognitive science theories and concepts have started to be used to explain entrepreneurship subject matter. Cognitive perspective has provided new points of view to understand the phenomena which are related to entrepreneurship .In our daily lives, factors like information overload, high-level of uncertainty, strong emotions in the face of incidents, time pressure and exhaustion affect human cognition continuously and make people take new and sharp decisions all the time. This situation is a fact for entrepreneurial cognition as well. Therefore, cognition research is mainly focused on human cognitive processes or information processing systems and has aimed to predict whether these processes show any difference between entrepreneurial individual and people who do not have any tendency for entrepreneurship. Although research over human cognition has continued for over a century, everything about this subject matter has not been resolved yet. In fact, studies that have been conducted over human cognition include subjects like “how we think, reason, decide, use language and symbols and store information for future use”. A person’s capacity for processing the information which comes from external world is limited. Moreover, as human beings, we try to obtain the most efficiency with the least cognitive effort. As a result of this, we often use “short-cuts”. Therefore, our actions are less rational than expected and once again we often act with prejudice and make mistakes (Baron, 1998). Our cognitive styles are affected by adaptation and socialization processes as well (Akşit, 2003). Therefore, entrepreneurial cognition has its cultural codes. However, enough research has not been done over these cultural codes yet. It has been indicated that while taking risks, entrepreneurs do not act very differently from others but they act with very different terms while thinking about business opportunities so when they are compared to people who do not have entrepreneurial qualities, they are able to categorize the opportunities that have more profit potential (Palich & Bagby, 1995). Observations have shown that entrepreneurs are really different from other people in terms of personality characteristics and studies have proved that they are more focused on certain issues more than the others. 2.1 What is entrepreneurial cognition? In fact, it is more precise to ask the question of whether entrepreneurial thought exist. However, it is hard to have an argument over the existence or absence of entrepreneurial thought. Therefore, it seems that it is more appropriate to mention a certain entrepreneurial thought style and defining this certain style is more convenient. Entrepreneurial thought defines knowledge structure of people who use judgments, evaluations and decisions which include using opportunities, risk taking and growth.

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Studies about entrepreneurial cognitions are directed towards understanding of how entrepreneurs associate gathered information that seems not related to each other and how they use mental models. This data helps to determine new products or facilities and produce them. Besides, it helps to start business life and bring the resources together to develop/grow (Mitchell et al., 2002). However, there are so many variables about this subject. For example, it has been understood that even current moods affect cognition and the moods of people who have job interviews have become effective over the results (Robbins & DeNisi, 1994). Entrepreneurship studies deal with the questions of why some people create new opportunities more easily than the others and how they decide to make more efforts to realize their dreams or what the main differences are between successful and unsuccessful entrepreneurs. The answers to these questions have been searched in entrepreneurs’ personality characteristics. Entrepreneurs differ from other people in terms of some certain characteristics and they also differentiate from others in distinguishing the opportunities and pursuing them. At the first sight, this hypothesis seems rational. When considered from this aspect, significant data/answers can be found related to the questions above (Baron, 1998). Firstly, entrepreneurial people are braver and bold, more tolerant and they are more effective in dealing with stress. However, one of the most significant differences that differentiate them from others is their competence in seeking and exploring the opportunities. There are two significant answers to the question of why some people discover entrepreneurial opportunities more than the others (Mitchell et al., 2002). a) Having the necessary knowledge to identify the opportunity, and b) Using cognitive qualities about this subject in their own favor as is required (Shane & Venketaraman, 2000). In other words, entrepreneurial cognition has the capacity for obtaining information to discover and take the opportunities; and using cognitive qualities that can process this information for their own favor. Entrepreneurial cognition like non-entrepreneurial cognition has the propensity for misapprehension over many issues. For example, their being over optimistic can lead them to take high-level risks. “Cognitive blind spot” can prevent them from seeing the reality about risks and can cause them to make decisions as being isolated from their past lives. Glowing images of the future and their plans can make it hard to take their lessons from the past (Kahneman & Lovallo, 1994; Qtd. in Baron, 1998). Positive and negative moods can affect the memory in appositive or negative way; and someone who encounters a new situation can make wrong decisions because of his/her current moods. Individuals focus on the cognition of their emotions in the face of an incident or situation while they are experiencing external world. However, their cognition about their emotions does not match with a real situation. In other words, while people say that “I like this” or “I don’t like this”, they can have emotions resulting from a similar situation in the past but not from the actual situation at that moment. This process, which is known as “affect infusion” can cause errors in cognitive decisions. This process affect entrepreneurial consciousness as well because effortful processing of information processes the information more automatic compared to less effortful processing system. It is highly possible for entrepreneurs to encounter uncertainties in their daily lives. When they face a new situation, unlike others, they have to modify existing information or find new data and use it for a new solution. They have to be more constructive and think more cautiously in new situations. Entrepreneurial people encounter more new situations than

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others as part of their jobs and they have to manage more stressful relationships. As a consequence, they experience more severe emotions and this can lead them to generalize their emotions to other situations, which sometimes can be inappropriate. Compared to others, they transfer more emotions from their previous experiences to new situations. Therefore, their thoughts, judgments and decisions can be affected by emotions that are actually not associated with that situation. It is known that while more cognition which is not associated processes stimulus in the case of uncertainty, they felt more stressed. When only the emotions become automatic, cognition can follow this automatic processing. The environment that influences entrepreneurship cannot be estimated. Under these circumstances, individuals cannot follow the predictable methods that they developed before so cognition and behavior have to reorganize themselves. Individual processes more data to make the environment more predictable. The way of knowing with what cognitive elements individual’s emotions are affected is to focus on his perception of external world (Baron, 1998). However, external world perception cannot be formed independently of value. The individual’s perception of his performance relating to his own ability is also associated with his perseverance. Intervening unexpected problems and overcoming obstacles is a powerful cognitive element for entrepreneurs and it requires a high-level perseverance. Perseverant individuals have the ability to find new ways to overcome obstacles and restrictions fearlessly in environments that require an uphill struggle. Perseverance that is accepted as one of the most powerful qualities of entrepreneurial individual keeps on struggling with persistence even in case of failure by challenging misfortunes (Kümbül-Güler, 2008). Therefore, entrepreneurial individuals have to focus on positive situations and have to think in the long run in order to cope with negative situations while they process information.

3. Entrepreneurship and personality 3.1 Entrepreneur’s general personality traits Since the first studies considered entrpreneurship as an organisational and industrial concept and this kind of research finds performance rating more suitable for its working process, the first related research is usually focused on actions and behaviours of entrepreneurs but their personalities are not emphasized (Cornwall & Naughton, 2003). However,it is known that certain characteristics that individuals have can have important influence in taking decisions to set up a business and achieving success in entrepreneurship (Brandstatter, 1997). Understanding entrepreneurship process depends on analyzing and determining entrepreneurial qualities and common trait of entrepreneurs. It is known that entrepreneurs are different from other people in terms of attitude, perspectives and some basic qualities. In other words, some people have the ability to see the new opportunities and are more skillful to fulfil their dreams about business whereas it is almost impossible for others to get that kind of achievement (Baron, 2000). Therefore, knowing the basic qualities that differentiate entrepreneurs from others is necessarry either to provide cultural transformation which will contribute to creating new entrepreneurs or to uncover entrepreneurial qualities that remained hidden in some individuals. A lot of research has been done by various researchers to determine the basic qualities of successful entrepreneurs. Baron (2000) explains successful entrepreneurship in terms of

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cognitive and social factors. He states that successful entrepreneurs are people who strongly believe in their own judgements and they have high social perceptions and ability of successful interaction. He also says that they are people who can be accomodated fast to new circumstances. Chell, Hawort and Bearly (1991) explain successful entrepreneurship as the quality of seeing and using business opportunities and starting appropriate actions. Lambing and Kuehl (2000) think that an entrepreneur has qualities like self-confidence, determination, risk-management, creativity, perfectionism and tolerance against uncertainity. It is also claimed that entrepreneurship is motivated by socio-psycological factors such as helpfulness, altruism, responsibility, social justice and forgiveness. This claim is an objection to people who claim that entrepreneurship is motivated by economic and sociobiologic factors (Montanye, 2006; Gibson and Schwartz, 1998). The fact that entrepreneurship is affected by numerous factors is also related to multiple characteristics that are attributed to it. Therefore, entrepreneurship is multi-dimensional and that’s why there are so many qualities to be considered when entrepreneurship qualities are referred to. Frequent entrepreneurial qualities are given in Table 1. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.

Self-confidence Constancy Being active and energetic Skill Risk taking Dynamizm & Leadership Optimism Ambition Versatility Creativity The ability of Manipulation The Ability to Communicate with people Initiative Flexibility Intelligence Focusing on Clear Objectives Being competitive Independency Sensitivity to critical situations Efficiency Being Decisive

22. Reliability 23. Prevision 24. Honesty 25. Commonality 26. Being profit-minded 27. The Ability of Learning from mistakes 28. Desire for Power 29. Good personality 30. Self-centeredness 31. Courage 32. Imagination 33. Understanding/Sympathy 34. The Tolerance against uncertainity 35. Agression 36. Satisfaction 37. Advantage 38. Being promising 39. The Ability to rely on employees 40. Sensitivity 41. Integrity 42. Maturity

(Source: Kuratko & Hodgetts (1998), p. Otd.in Aykan, 2002)

Table 1. Frequent entrepreneurial quality According to the chart, individual entrepreneur is expected to have socially accepted values like honesty, trust, reliability, maturity, integrity, sympathy and socially approved emotions such as sensitivity, satisfaction, optimism. Besides, they are expected to have the ability of interpersonal communication skills like having good relationships, which include

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communicating and influencing other people so they must rely on employees. They are also expected to have the potential to improve life to a higher standard by working efficiently, being competitive and having self-confidence. Being energetic and having iniatitive are also required to be able to have the qualities like risk taking, leadership and the ability to focus on clear objectives. They are also expected to have alot of positive personality traits such as being tolerant against uncertainity and courage. Being skillful and patient are also required qualities.These individuals must have vision for future. Therefore, studies associated with individual entrepreneur can be gathered around some common qualities. A very significant number of studies associated with common traits of individual entrepreneurs argue that individual entrepreneurs are people who have risk-taking ability. Risk-taking is related to innovation and creativity and it is necessary for the realization of objectives. Having high self-confidence increases the tendency to take risks. However, it is also known that excessive self-confidence leads to an ignorance of risk factors. Individual entrepreneur knows his limits. Therefore, he does not take unnecassry risks. He can control his emotions and accepts risk if only profit equals it or higher than it is (Tan & Pazarcık, 1984). There are different points of views that risk-taking is a characteristic of an entrepreneur. Very few studies, for example McClelland’s research points out that the ones who are strongly in need of success moderate their desire for taking risks and moderate risks bring a high motivation for success. Similarly, the study states that people who have a strong self-control system also tend to be in need of success and they are restricted as moderate risk-takers. According to Low and MacMillan (1988), risk-taking is not a characteristic of an entrepreneur. They have tendency to take risks as much as everyone does; however, they are very good risk managers. It is claimed that second common trait of individual entrepreneurs is “innovation” and “creativity”. Imagination, following dreams and trying new ideas are some important characteristics of entrepreneurs. The claim of seeing the opportunuties where others see limits and turning them into business ideas is very strong in these individuals (Tekin, 1999). Entrepreneurs are very successful in developing new ideas for radical changes and they want to work in environments which are less structured and where there are fewer rules. They are mostly concentrated on action more than efficiency (Kümbül-Güler, 2008). It is almost a necessity for them to introduce original, new and surprising ideas or act in an original way or surprisingly; however, all these ideas and actions must contribute to his life or the others’ lives in a positive way (Peterson & Seligman, 2004). Successful entrpreneurs are determined and patient. They don not avoid decisions and look for solutions instead of accepting problems as they are. Entrepreneurs enjoy struggling with failures and obstacles. It is very important to be determined and perseverant in order to handle failures and overcome obstacles (Kuratko & Hodgetts, 1998; Otd. in Aykan, 2002). Perseverance sifnifies performance related to an individual’s perception of his own ability. Persevarance as an entrepreneural characteristic is a strong cognitive element in order to handle and overcome the unexpected difficulties and obstacles. A perseverant individual has the ability to be able to find new ways to get over obstacles and limitations in competitive environments. Perseverance, which is accepted as one of the strongest points of individual means to keep struggling persistently by challenging misfortunes and difficulties (Kümbül-Güler, 2008). Individual entrepreneurs are much more determined than others in

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challenging difficulties are and obstacles are and they observe the development of the conditions for the solution so that they can respond appropriately at the right moment. Self-confidence and optimism are also common characteristics of successful entrepreneurs. This individual believes that he can overcome all difficulties he meets through his selfconfidence. Self-confidence accelerates the development of positive feelings by increasing inner peace.Self-confident people have passion to learn and they are open to searching and criticism. Therefore, entrpreneurs have an optimist point of view (Avşar, 2007). However, as it was mentioned before, they are very sensitive about risks that can be resulted from excessive self-confidence so they don’t allow themselves to make irrational moves.It is known that creativity, self-confidence and optimism trigger entrepreneurs interactively. Optimism is also defined as the tendency to concentrate on the positive side and see the best opportunities; however, seeing those opportunities requirs asking right questions (KümbülGüler, 2008). Entrepreneurs are not people who produce excuses for why something can not be done by focusing on problems because they are opportunity oriented (Dees et al., 2001). They use their self-confidence to choose creative and risky options fort he problems and opportunities.Therefore, self-confidence is seen as a compulsion for entrepreneurs (Bird, 1995; Otd.in Cansız, 2007). Successful entrepreneur is someone who aims to act independently and in accordance with this purpose, he carries the risks. It is impossible for an entrepreneur to be trapped in strict bureaucracy and they are cabaple of resisting against rules or forcing to change rules in order to reach their aims. They are skilled at acting independently. Entrpreneurs are people who make a difference compared to others (Kuratko & Hodgetts, 1998). For an entrepreneur,independency means making moves freely without depending on anybody while taking decisions and it also means to act avoiding rules, procedures and social limitations.Entrepreneurs don not take all decisions alone but they want to be the only authority while taking the most important decisions (Cansız, 2007). Kourilsky and Walstad (2002) carried out a research on high school students and it was discovered that one of the reasons underlining the desire for having their own business is to be able to act independently. However, nowadays besides entrepreneur’s desire to act independently, the concept of “team business” has come into forefront and it has been underlined that success is only possible by team work (Chell, 2007). Since business relations spreaded beyond the nation, international division of labour is inevitable. Because of the factors of intercontinental competition and free movement of capital, social structure and relations change constantly so to be able to exist in this changing world, entrepreneurs have to renew themselves continously. However, no matter how entrepreneurs keep up with this changing world, they can stil remain in uncertainity because of these changes. Therefore, it is necessary for them to have the ability of tolerance for uncertainity to be able to stay away from stress and anxiety. The stronger tolerance they show towards uncertain conditions, the less they are affected by them and they can handle negative stiuations more easily (Avşar, 2007). In fact, risk and uncertainity are complementary qualities. Each risk has an uncertain element in it and each uncertanity involves a process, which is full of risks. Showing tolerance for uncertainity means their dealing with problems without feeling psychological pressure under the lack of information and unknown situations. Entrepreneurs not only perform in uncertain conditions but also look for new possibilities so that they can study and overcome uncertainity as they see it as

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an achievement (Cansız, 2007). Johnson (2003) said that even when they do not have powerful predictor sources, entrepreneurs are able to act and work efficently without feeling discomfort. Characteristics associated with entrepreneurs should not mean that they are selfish and selfcentered people who only think about themselves. One of the most important factors that motivate entrepreneurs is that they consider not only their own personal benefits but also social benefits. Individual entrepreneur figures out advantages for himself while working in production field but at the same time he considers the advantages and disadvantages of this situation for the society. In this context, “altruism”that means “having the advantage for the other person’s benefit” is one of the most important characteristics of entrepreneurs. Altruism which is studied in the context of prosocial behaviour involves protecting and increasing personal wellfare of related people. Entrepreneurs feel the need to make contributions to the society as well as personal success and advantages and they prove that they can make sacrifices for the society not only for their own good (Montanye, 2006; Velamuri, 2002). One of the basic characteristics that entrepreneurs must have is “empathy”. The fact that they have other powerful entrepreneual traits is not enough for success. Being able to look at the world and the events with the opposite side’s point of view provides competitive advantage in entrepreneurship. Emphatic entrepreneurs get advantages over many points. They meet their coustomers’ expectations in the market and they make their employees happy by meeting their expectations from business enterprise and entrepreneur. They take precautions by predicting their competitors’moves beforehand (Cansız, 2007). 3.2 Entrepreneurship and motivation It is known that motivation has an important role in forming entrepreneurship culture. Motivation includes a trinity cycle which is either an incentive that takes the entrepreneur to a certain target or it is the behavior which is done to reach the target and lastly it is the process of reaching the target (Cabar, 2006). It is highly difficult to develop a motivation model for every person or entrepreneur although it is admitted that there are some incentive tools for motivational purpose. We can include financial, psychological and social tools as incentives.There are also organizational and administrational incentive tools to be added to the list (Cabar, 2006). Values are the most wondered issue among these incentive tools. They cause an individual to have a purpose because their obeying existing rules of organization can be controlled mostly by these reinforcements. Yet economic results based on either reaching the objective or not achieving the goal are factual and these facts motivate individual more towards the action that can take him to success. However, values are abstract issues. It is interesting and also hard to understand exactly what values motivate individual to decide to be an entrepreneur. Yet a lot of research, (Glazer et al., 2004; Knafo & Schwartz, 2004; Bardi & Schwartz, 2003; Devos et al., 2002; Naktiyok & Timuroğlu, 2009) which was carried out about this issue emphasized the relationship between entrepreneurship and values by means of motivational aspects and defined ten value types on this subject. Gain power, success and get pleasure, guide oneself, be helpful for others, follow the existing traditional forms, provide security, contribute to the universal forms are the main ones of these value types. Each of these value types present a motivational purpose and influence behaviors (Gibson & Schwartz, 1998). Power, social status and prestige, for instance, prove the importance of

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authority and control over people and resources. The values under this dimension cover social power, wealth, authority, public image and publicity (Schwartz & Boehnke, 2004; Bardi & Schwartz, 2003) and individual tends to experience entrepreneurial action by means of these needs. While Peay and Dyer were studying the relationship between willingness for entrepreneurship and power, they found out that entrepreneurs are motivated by both their personal and social power needs (Peay & Dyer, 1989). Yet again the fact that there are cultural differences on this point must not be ignored. For example, Bhandari (2006) carried out research over the students in India and he tested his hypothesis that claims that social status and prestige influence entrepreneur’s intention but couldnot prove this correlation. Individual should set targets on how to live his life and being able to move towards these clear objectives is an important source for inner motivation. In these sense, setting a right and reachable target is important because each achieved target means the first step of a new reachable target. Yet every achieved target helps to eliminate and satisfy many important psychological needs, some of which are self-actualization, pride and the need for achievement (Allan, 1998). Need for achievement which is considered among important psychological needs is one of the variables whose effect in development of entrepreneurial behavior is mostly studied. Need for achievement means that individual sees and feels satisfied when his actions have positive outcomes by giving his own decisions and carrying his responsibilities (Avşar, 2007). McCleland (1961) suggested three dimensions of need for achievement: a) personal responsibility for solution of problems, setting targets and achieving goals; b) taking risks instead of luck; c) predict outcomes of a decision or a business success. According to McClelland (1961) individuals who have a high need for achievement prefer medium-level risky tasks which require personal skill and effort in order to be able to take personal responsibility of obtained results. Therefore, it is stated that individuals who have a high need for achievement tend towards entrepreneurship rather than working on salary basis. Besides, entrepreneurs have a desire to be successful more than to earn money. The gain obtained is not a consequence of the need for achievement but it can be considered as a means or feedback to evaluate success (Kümbül-Güler, 2008). According to Johnson (1990), the most important factor of entrepreneurship is the motivation for success. Individuals who have a high motivation for success have a high sense of responsibility. These individuals set targets to try to reach them and get feedback related to their performance. They do not put the blame on luck or external factors but take the responsibility in case of a failure. Studies have shown that there is a correlation between entrepreneurship and a high need for achievement. In the longitudinal research that McClelland (1965) carried out, it was determined that the students who had a high need for achievement became entrepreneurs after years. Likewise, Fineman (1977) and Collins, Locke and Hanges (2000) have stated that need for achievement predicts entrepreneurship in a meaningful way. According to the theory of need for achievement, an important motivation source is“need for superiority”. Need for superiority is a part of need for power and it involves gaining and keeping the control in hand. Because individual who is in need for superiority desires to be influential over others and wants to be considered as valuable (Önder, 2010), they are expected to show tendency towards entrepreneurship as they have the opportunity to use power and gain superiority over employees due to the fact that entrepreneurs are the center of authority inside the enterprise (Kümbül-Güler, 2008). However, there are objections from the field of

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social psychology to the need of achievement that is suggested to have universal validity. Some studies in the field of social psychology (Kağıtçıbaşı, 1996) argue that the concepts of individualism and collectivism have become prominent since 1980s to understand the inner dynamics or different characteristics of societies. They suggest that “need for achievement” that is considered as intervening variable and even sometimes independent variable to explain economic growth earlier cannot fill in the space, which is prepared for it because of its entrepreneurial-individualistic quality. While explaining inner sources for entrepreneurial motivation, another concept that is emphasized is “need for autonomy”. Need for autonomy, which resembles need for independence, is the main reason for an entrepreneur to set up business. If an individual has need for autonomy, it means that he wants deeply to have the control over the issues associated with him. The fact that individuals who want their decisions to be in control over their lives avoid working under management of others; therefore, It is obvious that these individuals want to have their own businesses. It can be said that entrepreneurs as being independent individuals who take their own decisions and carry their own responsibilities have the need for autonomy (Kümbül-Güler, 2008). Autonomous individuals take the responsibility of their own judgments instead of following others’ ideas blindly. Besides, these individuals take the responsibility of their own lives instead of living based on other peoples’ opinions and experiences. Many researchers have observed that the role of entrepreneurship requires independency. According to the researchers, entrepreneur takes the responsibility to go after opportunities; take the responsibility of outcomes of their actions either successful or failed and carry on entrepreneurial efforts since they like independency (Shane, Locke & Collins, 2003). 3.3 Entrepreneurship and self-efficacy Self-efficacy is one of the main concepts of social-cognitive theory. It has been defined as the belief that one is capable of performing in a certain manner and how to be successful when he faces difficulties. The perception of self-efficacy affects one’s behaviors at least in three ways: (a) one’s choice of activities, which will be performed (b) one’s performance quality (c) one’s persistence in difficult tasks. It also increases the strength to overcome failures. The ones who do not have the belief of self-efficacy tend to emphasize their personal inefficacy and believe that potential obstacles cannot be overcome. One’s performance quality and persistence for difficult tasks can be affected by their self-efficacy beliefs (Bell-Gredler, 1986). There are four sources that affect one’s beliefs about their self-efficacy: enactive mastery experiences, vicarious experiences, verbal persuasion and physiological and emotional situation. Enactive mastery provides the most realistic indications about ability of bringing sources together for achievement. While one’s achievements raise the perception of selfefficacy, repeated failures can lower the perception of self-efficacy.However, enactive mastery experiences do not include simple achievements. The individuals who have only simple achievements can easily lose their courage when they face failure. Enactive mastery experiences and developing the perception of self-efficacy include cognitive and behavioral abilities that are necessary to perform a certain act in a certain manner. Vicarious experiences, on the other hand contribute to self-efficacy by means of models. Observing similar individuals performing certain acts in a certain manner can raise one’s perception of self-efficacy. Vicarious experiences are effective in the case of not

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having or very limited original experiences. Verbal persuasion, which is encouragements /incentives, suggestions and advice that are associated with one’s achievement or failure affect the sense of self-efficacy.However, if other sources do not exist, verbal persuasion cannot raise personal self-efficacy. Physiological and emotional state can give data about self-efficacy. People tend to interpret tension and stress responses as an indicator of poor performance. Therefore, tendencies that create stress and negative emotions must be decreased (Gredler, 1997). Self-efficacy, which is an important factor in determining entrepreneurial behaviors, develop in time and can be affected by many internal and external factors such as financial situations, personality and values (Cox et al., 2002). According to Zhao, Seibert and Hills (2005) entrepreneurial self-efficacy determines entrepreneurial intentions. It also affects the perceptions of formal learning, entrepreneurial experience, risk propensity and gender. Entrepreneurial self-efficacy defines entrepreneur’s belief about whether they are capable of doing their tasks successfully or they fail (Mueller & Dato-On, 2008). In entrepreneurship, one’s evaluation of self-efficacy begins with the calculation of performance time for the realization of processes like taking the opportunities, business planning, and financial preparation. Then individual has to go over the situation of achieving these processes and resources to set up a business. Lastly, individual identifies his chances to set up a successful business by evaluating positive and negative entrepreneurship experiences in his past (Summers, 1998; Otd.in Kümbül-Güler, 2008). Bandura (1986) says that self-efficacy is the most powerful predictor for choice of profession. On the other hand, according to Chandler and Jansen (1992), self-reported competencies predict entrepreneurial performance. Markman and Baron (2003) have stated that high-level self-efficacy is an important factor that enables to be a successful entrepreneur and that individuals with high-level self-efficacy are willing to take and carry on tasks, which require struggle. The individual who wants to test his own competence in every field of his life tend to face difficulties in business life. This situation raises his tendency to become an entrepreneur by stimulating his desire to explore his limits about difficulties. 3.4 Entrepreneurship and locus of control How individuals attribute responsibility of their actions and whether these different attributions can be evaluated as personal traits of individuals became the focus of interest in psychology in 1960s. Multidimensional research was carried out by Rotter (1966) on the concept called locus of control for long years. Locus of control is an important variable in explaining human behaviors in organizations and business life because their ways of taking responsibility in these fields of life, which require responsibility, are effective by means of consequences. According to Rotter (1966) locus of control is one’s belief and generalized expectation associated with the outcomes of one’s actions and incidents in his life are in his control or depend on some external factors. Rotter (1966) emphasized that people who have internal locus of control are more aware of the opportunities around them to achieve their goals and get into action to improve their environment. He also emphasized that they underline the effort made for success and they are tend to improve their skills. These individuals feel that they are responsible for their own lives and they perceive that their destiny is affected by their own decisions not external factors outside their influence. The beliefs of having control over their destiny prevent them from doubting the process of

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personal transformation because they feel responsible for their actions. They form a strong relationship between their actions and the things going on around them. This self-confidence and independence make these people less anxious, more active and more successful. They make more efforts and they are mostly future-oriented. The people who have internal locus of control are also efficient and innovative. They have very highlevel of self-control. They tend to be more motivated and more successful both in their academic lives and in their businesses compared to individuals who have external locus of control. Their belief in their potential makes these people tough and resistant against pressures so they are not easily affected (De Vries & Balazs, 1999). External locus of control is an aspect of personality, which is defined with the belief that individual does not have a control over his actions and their outcomes but his life and his experiences are under the control of external forces such as God, fate, ill-fortune and powerful others (Rotter, 1966). These individuals mostly see change as a danger. They do not feel control of powers that control their lives. They prefer to stay in a passive position in case of a change in their lives. They do not have the ability to step forward with determination. They are more obedient and conformist. They are likely to response with depressive reactions (De Vries and Balazs, 1999). Individuals with internal locus of control believe that they can control their business environment by their actions.Furthermore; they expose entrepreneurial performance and experiences. On the other hand, individuals with external locus of control have actions that are more conformist and they behave obediently. Individuals with internal locus of control become more successful when tasks or organizational demands require independence and initiative. It is possible for these individuals to have higher motivation for the tasks, which require higher motivation if they believe their efforts will bring reward. These individuals are more suitable for professions that require technical information and skill. They are also more suitable for professional jobs such as managers or supervisors whereas individuals with external locus of control are more suitable for traditional working methods and professions that do not require skill such as production business or office work. Besides, individuals with internal locus of control have higher job satisfaction because they believe in their abilities and that their efforts will result in a good performance. They are almost sure that their good performance will get award and they perceive their positions in a more objective way.Internal locus of control is a characteristic that is found more in business founders compared to other individuals as it is related to entrepreneurship (Spector, 1982). In a study which is done in Turkey (Korkmazyürek et al., 2008), the relationship among innovation, risk-taking and focusing on opportunity is analysed. They are the dimensions of locus of control and organizational entrepreneurship. In this study, it was determined that the ones with internal locus of control are more innovative, risk-taker and more target focused compared to the ones with external locus of control. Yet some studies point out that individuals in communitarian cultures are more external locus of control. This situation is used as a variable in explaining why there are less entrepreneurial traits in communitarian cultures.

4. Entrepreneurship and culture 4.1 A general overview on entrepreneurship culture Studies which have been carried out on entrepreneurship have showed that there are a lot of indicators of entrepreneurial behavior. An important part of these studies have focused

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on personal characteristics of individual entrepreneur or circumstantial properties. The studies that were focused on personal traits have claimed that entrepreneurship is an individualistic behavior. Therefore; they said that it is more important to understand the relationship between individualistic behavior and personal characteristics. Some other studies emphasize entrepreneurial qualities, and they think that culture must be the actual research field. They believe that it is impossible to understand an individual’s entrepreneurial qualities without examining cultural properties of the society in which individual lives. In fact, these two propensities do not exclude each other. Both of them attach importance to each other’s data and use it in their studies to improve them. Yet,when it is considered on the whole, the subject matter of entrepreneurship has the features of a field which can be studied in two ways , one of which examines personal characteristics,socio-demographic attributes, future objectives, hopes and expectations of individuals by focusing on individual properties; on the other hand, in the concept of entrepreneurship culture, it examines family, education, religion and belief systems by paying attention to value system that individual belongs to and cultural environment which this value system creates. In the subject matter of entrepreneurship, studies which are focused on the effects of personal factors on entrepreneurship highlight that motivation resources that support entrepreneurship are mostly related to person and they do not pay much attention to individual’s social motivation resources. These studies have shown that individual’s personal resources affect individual behavior all at once not one by one. For example, individual’s entrepreneurship is triggered by not only achievement motivation but also being tolerant for uncertainty and having a high potential to take risk. There are different cultural effects behind achievement motivation that seems to be individualistic. For example, the fact that autonomy or auditing is more individualistic structured or more social structured have a different impact on achievement motivation. Achievement motivation in American culture is determined over personal effort, actions and competition with others whereas experiences to impose individual achievement in communitarian cultures like India have failed (Kağıtçıbaşı, 2000). Likewise, cultural differences cannot be ignored in terms of risk-taking and tolerance for uncertainty factors. Even though personal characteristics of entrepreneurs have been studied for a very long time, the history of empirical studies which make comparative analysis of these characteristics in different cultures is not very long (Mueller & Thomas, 2001). Especially need for cross-cultural studies that will contribute to development of cultural approach related to entrepreneurship is obvious. Some researchers who consider entrepreneurship as a personality characteristic (Tanrısever, 2004; Cabar, 2006) emphasize that the connection of these characteristics with the culture must not be ignored. These researchers also argue that the individuals in some cultures that support entrepreneurial qualities can have these characteristics more than the ones who live in some other cultures which do not support entrepreneurial skills. According to these researchers, cultures that support their members’ independence raise individuals with more entrepreneurial skills in comparison with the cultures that expect obedience from their members. At this very point, the concept of entrepreneurship, which aims to raise the type of person who is oriented to give opportunities to others and obtain results for his studies and actions by being bold and dynamic has come to the forefront.

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Conformity, consistency and efficacy messages that individuals get from media and personal relationships through their lives influence their intentions for being an entrepreneur while choosing their professions (Akşit, 2003); and in an age of constant initiation of division of labour, professions that require entrepreneurial skills are encoded in individuals’ brains by their cultural environment. Besides, universal values like equality, a peaceful world, being in harmony with nature, social justice, freedom of opinion and protection of environment (Schwartz & Boehnke, 2004) that are popularized through globalism also existed in the values that are supported by entrepreneurs. Entrepreneurship culture improves with these values and post-modern culture causes to form a new entrepreneurship culture as a result of universal thought and standardization (Nicholson & Anderson, 2005). It is not correct to categorize cultures and to say that cultures either support entrepreneurship or they are opposed to it entirely (Hisrich & Peters, 1998). There are subcultures that affect value systems in every culture. These sub-cultures are nourished by tradition and social relations habits or religion. Yet, every sub-culture or dominant culture lacks the power of framing all behaviors of individual. As a matter of fact, it is even possible to have collective behavior models in cultures that seem contrary with each other. For example, Yasin (1996) could not identify the difference between Palestinian Muslim entrepreneurs and Jewish entrepreneurs in terms of their needs for achievement and he attributed this situation to the effects of tradition more than religious values. 4.2 Value systems and entrepreneurship Values are standards and principles that are accepted by the members of a society. Value, which is mostly nested within attitude are related to cultural properties that lie behind attitude. Values affect attitude and attitude affect behaviors (Sweney et al., 1999). Value, which is identified as permanent beliefs that determine what must be done in a situation, takes place in a value system within other values and some values play a more central role than the others in this system (Kağıtçıbaşı, 2000). Values guide individuals to act within reasonable social roles by drawing the outline of socially-accepted behaviors in a society. They structure individuals’ interests in every field of their lives and the courage for actions of their interests. Thus, individuals act accordingly for valuable aims in accordance with their roles and expectations. Besides, values are means of social control and pressure and they are the elements/factors of social process. However, what values are associated with what actions or whether values have any relation with actions in general is not clear. Yet again, it is assumed that the relationship between values and actions is arranged by a simple motivational structure (Bardi & Schwartz, 2003). Values are effective in determining the standards that guide individuals for their actions about their jobs in working life and in their plans to solve conflicts. Furthermore, business values are instruments for motivation and undertake the function of applying sanctions on individuals’ actions. Nowadays, generally, enterprises in the world prioritize values like creativity, imagination, entrepreneurship, having a vision and also business ethic, social responsibility, total quality manner and in-service training. They also attach importance to respect for human rights, research and developmental activities and lastly a constant selfimprovement (Silah, 2005). However, despite these generally accepted principles, there are different values among cultures in business world.

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The value that is produced by working life is not limited by only business values but since it gives individual the opportunity to know his limits by putting him in a social environment, it creates differences in individual‘s personal values. For example, individuals who improve their social status through business life also improve their self-confidence. Self-confident individual tend to expand the limits of business activities; therefore, a new business position enables to internalize new business values and this cycle carries on like this. In this context, making an attempt for a business means a constant framing of not only personal values but also business and social values. Within this period, individual as a part of social culture is in an interaction with traditions, customs and ethical values. In social groups that have external environment-oriented leadership and support high moral values, individuals’ chances to have entrepreneurial values increase (Casson, 1990). Enterprise culture of economic organizations is also effective in this period. It is important to have fiduciary culture in organizations to improve creativity, innovation and entrepreneurship. However, control mechanism can be internalized in such organizations and individual can make productions not only for the enterprise but also to experience the feeling of selfimprovement (Sargut, 2001). Therefore, both business values and enterprise values must show parallelism with social values regarding the society to which they belong. The fact that these values coincide with individual’s personal values is very important in effective entrepreneurship. Likewise, all these values have to update themselves regularly as part of universal values. Organizations can take the opportunities both to be able to deal with deepening high-level competition in business lines and in order to satisfy their employees as long as they make connections among these values and update them as well. General characteristics of culture are as important as personal characteristics for cultural interaction and conducting activities within the values of social structure. Individuals’ cultural commitment is stronger in societies that have traditional values compared to modern societies (Williams & Narendran, 1999). In traditional societies, there is less risk and the rules of life are determined by the society, which means everything is clear and obvious in these societies. In modern societies, however, individual has to struggle against uncertainty due to rapid change. Therefore, individuals in modern societies take more risks and try to struggle more against uncertainty in order to accommodate to the period of change from early ages. As a result they have to have qualities that require entrepreneurship at an earlier age. In countries which are in the period of transition from traditional to modern society, Uncertainty Avoidance still remains in power as a cultural value. In societies with a high Uncertainty Avoidance index, it is preferred to act by remaining in structured situations in every area of life. According to the results of Hofstede’s research, which includes four cultural dimensions (Power Distance Index, IndividualismCollectivism, Masculinity-Femininity and Uncertainty Avoidance Index), it is determined that societies of countries like Greece, Japan, France and Turkey have a high Uncertainty Avoidance whereas countries like Denmark, United Kingdom and Sweden have a high tolerance for Uncertainty. In some later research concerning Turkish society (Sargut, 2001; Wasti, 1995), it was found out that there is a high Uncertainty Avoidance in this society. Raising individuals with entrepreneurial qualities in traditional societies can be possible through educational institutions that have entrepreneurial objectives. Through this period, it is strictly necessary to have new paradigms and policies.However; there is paradox here as traditional societies avoid change in education. Therefore, it takes seriously long time to raise individuals with entrepreneurial qualities in traditional societies.

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Entrepreneurial individuals are intensely affected by sub-cultural values which they belong to. For example, in Turkey gender in business life creates a value perception. Turkey tries to stick to properties of a male-dominant society. Therefore, as an essential entrepreneurial quality, hard-work which is emphasized as a male quality has come forward. Because of the belief which suggests that females are more emotional and they cannot be reasonable, simpler and less demanding jobs which require love and affection such as social services, psychologist, human relations and teaching are considered to be more suitable for women. 4.3 Entrepreneurship in individualist and collectivist cultures The fact that how internal dynamics of social relations affect individual and how different characteristics of different societies shape their individuals’ behaviors has been a matter of discussion for many years. The concern for individualism-collectivism is considerably associated with the concern for human dimension of economic growth. While studying the ways of how different cultural structures affect economic growth, it has been determined that one of the most important four characteristics that makes cultures unique is individualism/collectivism (Hofstede, 1980, 1983). It has also been indicated that individuals who grow up in individualistic cultures adopt individualistic cultural behaviors and the ones who grow up in collectivist cultures adopt collectivist cultural behaviors. It has been discovered that this situation has also been reflected in psychological process and behaviors (Marin, 1985). Recently, the increasing interest of the West towards the East, the rise of Japan and the economic development of four Asian Tigers (Hong Kong, South Korea, Singapore and Taiwan) initiate to conduct a lot of research over mother-child relationships and other organizational relations in these countries. Previously, it was claimed that individualistic cultures raise more entrepreneurial individuals and as a result, economic growth is faster in those cultures. However, the experiences of economic growth in the Far East affected this idea significantly. Realization of rapid economic growth in these countries in which commitment and collectivist cultures are common has become an exception to break accustomed general pattern in which individualism and economic growth are considered to be identical (Kağıtçıbaşı, 1996). The variation of creative behavior of people varies according to individual’s character, cultural environment he lives in and the education he has. In individualistic societies, creativity can be affected by both the age of individual and the complexity of jobs and tasks he does; it may also be influenced by the pressures to which individuals are exposed to get a reward in a certain reward system. In collectivist societies, acting within the community and giving priority to social interest over self-interest are the most important factors that affect creativity (Yellioğlu, 2007). The USA can be the best example for an individualistic society; on the other hand, Asian countries can be given as the best examples for collectivist societies. Even if European countries are mostly individualistic, they also hold the qualities of collectivist societies (Döm, 2006). Tiessen (1997) mentions that entrepreneurs in individualistic and collectivist societies follow different strategies from each other in providing resources. Busenitz and Lau (1997), who studied the reasons why some cultures create more entrepreneurs than others, think that this is determined by personal characteristics, social context and cultural values in collaboration with each other. According to them, cultural values like IndividualismCollectivism, Uncertainity Avoidance, Power Distance Index, Long-Term Orientation; social

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context, which includes social mobility, ecology, business and marketing conditions; and individual variant/personal variables such as risk-taking, locus of control and need for achievement come together to form a cognition so that they can initiate individual to set up the enterprise. Besides, it is also emphasized that entrepreneurial qualities are more dominant in high security societies. Being able to have safe relationships depends on individuals’ long-term interaction with the people opposite side. Long-term relationships take place by means of school and family. Family is the first institution that culturalise individual, however, school which takes place in child’s life from the very early age especially in big cities also is a very important agent of cultural transmission. Family as the initial culture transmitter teaches the child how to shape from very early ages via their class positions. Hence, family as a sub-culture teaches the child how to act within economic institutions. Cultural factors that affect entrepreneurship in these sub-cultures display diversity. It is known that extended or joint families in traditional societies based on primitive agricultural economics expect their children to be dependent and loyal. Erelçin (1998) has shown that urban people attach more importance to material support rather than moral support whereas rural people are more likely to share their material and moral resources with their close environment. These findings show that rural area relationship models empower the tendencies of collectivist behavior. When family environment supports entrepreneurship, entrepreneurial qualities of child get stronger Families in Turkey do not support them to become independent individuals while raising their children. Being a “dutiful child” is prior to being rich or having financial resources. Since children have difficulty in making decisions without taking permission from their parents (Ekşi, 1981; Geçtan, 1973), they can feel blocked and cannot do what they want. Therefore, many young people have difficulty in aiming nonconventional jobs so they stay away from doing some jobs they can easily do. Young people show a tendency to deal with more conventional and guaranteed jobs. Even if they are less paid, they would rather have clerical occupations than risky jobs that do not have a guarantee. These cultural codes that hinder children to achieve autonomy also prevent them from developing entrepreneurial qualities. The use of force on children leads to an inclination in their abilities to develop inner discipline and self-control. Even though there is less obedience in family and school relationships with the concept of modernity compared to past, corporal punishment methods can still be accepted as tools for child education (Göka, 2006). Children who are in a powerless position against adults are forced to show behaviors that are acceptable by adults to be able to escape from these uses of force and they are also made to act within the limits that adults established. This whole process is accepted as an obstacle that blocks the development of entrepreneurial qualities.

5. References Akşit, G. (2003). The Study of the Entrepreneur Intention in Different Cultures: An Application to University Student. Unpublished Master Thesis, Akdeniz University. Allan, J. (1998). Daha İyi Nasıl Motive Etme, Çev. Ali Çimen, Timaş Yayınları, ISBN 975-362396-8, İstanbul.

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Kağıtçıbaşı, Ç.(2000). Kültürel Psikoloji, Kültür Bağlamında İnsan ve Aile, Evrim Yayınevi, ISBN 975-503-102-2, İstanbul. Kahneman, D. & Lovallo,D. (1993). Timid choices and bold forecasts: a cognitive perspective on risk taking, Management Science, Vol.39. No.1, pp.17-31, ISSN 1526-5501. Knafo, A. & Schwartz, H.S.(2004). Identity formation and parentchild value congruence in adolescence. The British Journal of Developmental Psycholog, Vo.22, No. 4, pp. 439458, ISSN 2044-835X. Korkmazyürek, H., Tokat, A. O. & Basım, H. N. (2008). Örgüt içi girişimcilik bağlamında yenilikçilik, risk alma ve fırsatlara odaklanma tutumları: karşılaştırmalı bir çalışma. İktisat İşletme ve Finans, Vo. 23, No. 263, pp. 70-81, ISSN 1300-610X . Korpysa, J. (N.d). Interdisciplinary Dimension of Entrepreneurship, 20.08.2011, Available from http://mikro.univ.szczecin.pl/bp/pdf/98/13.pdf Kourilsky, M. L. & Walstad, W. B. (2002). The e-generation, Kendall Publishing Company, ISBN 0787268925, Dubuque, IA. Kuratko, D. F. & Hodgetts, R. M. (1998). Entrepreneurship: A Contemporary Approach, Dryden Press, ISBN 0030196043, Orlando. Kümbül-Güler, B. (2008). Analysis of the factors determining social entrepreneurship, Unpublished Doctoral Thesis, Dokuz Eylül University. Lambing, P., & Kuehl, C. R. (2000). Entrepreneurship, Prentice Hall, ISBN 0130971162, New Jersey. Low, M. B. & MacMillan, I. C. (1988). Entrepreneurship: past research and future challenges. Journal of Management, Vol.14, No.2, pp.139-161, ISSN 0149-2063. Marin, G. (1985). The preference of equity when judging the attractiveness and fairness of an allocator: The role familiarity and culture. Journal of Social Psychology, Vol.125, No.5, pp. 543-549. ISSN, 1940-1183. McClelland, D. C. (1961). The Achieving Society, Van Nostrand, ISBN 978-0029205105, Princeton, NJ. McClelland, D. (1965). Need achievement and entrepreneurship: a longitudinal study. Journal of Personality and Social Psychology, Vol.1, pp.389-392, ISSN 0022-3514. Mitchell, R. K., Busenitz, L., Lant, T., McDougall, P. P., Morse, E. A., & Smith, J. B. (2002). Toward a theory of entrepreneurial cognition: rethinking the people side of entrepreneurship research. Entrepreneurship Theory and Practice, Winter, pp.93-104, ISSN 1540-6520. Montanye, J.A. (2006). Entrepreneurship, The Independent Review, Vol. 10, No. 4, pp. 549–571, ISSN 1086-1653. Mueller, S.L & Thomas, A.S. (2001) “Culture and Entrepreneurial Potential: A Nine Country Study of Locus Control and Innovativeness”, Journal of Business Venturing, Vol.16, No.1, pp. 51-75. ISSN 0883-9026 Mueller, S. L., & Dato-On, M. C. (2008). Gender role orientation as a determinant of entrepreneurial self-efficacy. Journal of Developmental Entrepreneurship, Vol.13, No.1, pp.3-20, ISSN 1084-9467. Naktiyok, A. & Timuroğlu, M.K. (2009). Öğrencilerin motivasyonel değerlerinin girişimcilik niyetleri üzerine etkisi ve bir uygulama, Atatürk Üniversitesi İktisadi ve İdari Bilimler Dergisi, Vol.23, No.3, pp.85-103, ISSN 1300-4646. Nicholson, L. & Anderson,R.A. (2005). “News and Nuances of the Entrepreneurial Myth and Metaphor: Linguistic Games in Entrepreneurial Sense-Making and Sense-

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Velamuri, S. R. (2002). Entrepreneurship, altruism, and the good society, In: The Ruffin Series in Business Ethics, Eds. R. E. Freeman, S. Venkataraman, pp.125-142, Philosophy Documentation Center, Retrieved from http://ssrn.com/abstract=993038. Wasti, A. (1995). Kültürlerarası farklılaşmanın örgütsel yapı ve davranışa etkileri: karşılaştırmalı bir inceleme. ODTÜ Gelişim Dergisi, Vo.22, No.4, pp. 32-41, ISSN 1010-9935. Williams, S, & Narendan, S, (1999). determinants of managerial risk: exploring personality and cultural influences. The Journal of Social Psychology, Vol. 139, No.1, pp.102-125, ISSN 0022-4545. Yasin, M. (1996). Entrepreneurial effectiveness and achievement in Arab culture. Journal of Business Research, Vol. 35, No. 1, pp.69-77, ISSN 0148-2963. Yelllioğlu, O, H. (2007). Örgüt, birey, grup bağlamında yenilik ve yaratıcılık çalışmaları. Ege Akademik Bakış/Ege Academic Review, Vol. 7, No. 1, pp. 133-152, ISSN 1303-099X. Zhao, H., Seibert, S. E., & Hills, G. E. (2005). The mediating role of self-efficacy in the development of entrepreneurial intentions. Journal of Applied Psychology, Vol. 90, pp.1265-1272, ISSN 0021-9010. http://wi.unigiessen.de/wps/pgn/dl/down/open/ebme_de/eb289e1f573d41eeb3b611b08 72d7f6a3b45acdbccb2ca7765bb9ef9670f46fe8e1ac8d725814ca4c5b85a6106ff2271/The _psychology_of_entrepreneurship.pdf

2 Entrepreneurial Intentions: The Role of the Cognitive Variables José C. Sánchez

University of Salamanca Spain 1. Introduction The impact of entrepreneurial activity and the creation of new businesses on the economic growth of a country and the generation of jobs are recognized worldwide. The degree to which a society stimulates entrepreneurial activity, as opposed to stimulating an individual to select a career as an employee, varies among nations, and within the different social groups of a nation. The reasons mentioned for these variations include cultural explanations (e.g., Altinay & Basu, 2002), business environment explanations (Acs et al., 2005), psychological explanations (e.g., Koh, 1996), or a mix of these. Accordingly, the study of the relation between individual’s sociodemographic and psychological variables with the desire to follow an independent career in the future, what we call “entrepreneurial intention”, is considered pertinent. Therefore, one of the objectives of the chapter is to determinate the antecedents of the entrepreneurial intentions of undergraduates. A second objective is to assess the degree to which the cognitive processes contribute, beyond the student country and socioeconomic condition, to students´ entrepreneurial intentions. The variables used to study entrepreneurs have gradually changed over the years (Sánchez, 2011a). The personality traits and demographic variables that differentiate entrepreneurs from non-entrepreneurs were the initial focus of interest. These lines of analysis allowed us to identify significant relations between certain personality traits and demographic characteristics and individuals showing entrepreneurial behaviour. Nonetheless, some authors have criticized these approaches for their methodological and conceptual limitations and for their limited predictive capability (Robinson et al., 1991) A new line of analysis, the cognition, has emerged as an important theoretical perspective for understanding and explaining entrepreneurial behaviour (Goodwin & Wofford, 1990; Sánchez, 2011b). Neisser (1967) defines cognition as “all processes by which sensory input is transformed, reduced, elaborated, stored, recovered, and used”. Mitchel et al. (2002) consider that “entrepreneurial cognitions are the knowledge structures that people use to make assessments, judgments, or decisions involving opportunity evaluation, venture creation, and growth” (p.97). From this perspective, since the decision to become an entrepreneur is considered to be both conscious and voluntary (Krueger, 2000), it seems reasonable to analyze how that decision is taken. The analysis of cognition thus contributes significantly to the study of entrepreneurship (Allinson et al., 2000; Mitchell et al., 2002).

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Indeed, some authors suggest that the future of entrepreneurship research should be focused on the study of cognitive social categories (Sánchez, 2011b). Thus, entrepreneurship can be viewed as a way of thinking, a way of thinking that emphasizes opportunities over threats (Krueger, 2000), a process (opportunity identification) that takes place over time (Carrier & Kyrö, 2005). The opportunity identification process is clearly an intentional process, and, therefore, entrepreneurial intentions clearly merit our attention. The entrepreneurial intention has been considered as the key element to understand the new-firm creation process (Bird, 1988), as a prior and determinant element in the performance of entrepreneurial behaviours (Fayolle & Gailly, 2004). In cognitive psychology, intention is the cognitive state immediately prior to performing behaviour (Krueger, 2003). Essentially, behaviour is intentional if it is not the result of a stimulus-response relation, and any planned behaviour is intentional. The intention to perform a behaviour (in our case, new venture creation) can be affected by certain factors, some of which are endogenous or internal (e.g., needs, values, habits and beliefs, Lee & Wong, 2004) and others are exogenous or situational (e.g., difficulty of the task). In this sense, entrepreneurial research has been conducted following two main lines: the personal characteristics or traits of the entrepreneur; and the influence of contextual factors in entrepreneurship (Robinson et al., 1991). From this last institutional approach, some entrepreneurial models with a cognitive basis emerged to explain this phenomenon: the Entrepreneurial Event Theory (Shapero & Sokol, 1982) and the Theory of Planned Behaviour (Ajzen, 1991) appeared as the main theory-driver models. They have been widely adopted by entrepreneurial intention research to analyze new venture creation. There is, however, little variation among the different approaches taken from these models (Krueger, 2000) and some authors have even tried to integrate them into a single model (Kolvereid & Lakovleva, 2009). These models use two critical antecedents of intentions that can be classified (give or take some obvious terminological differences) as perceived feasibility and perceived desirability. Now then, if the intentions depend on personal beliefs and attitudes, then researchers interested in entrepreneurial behaviour should also explore the sources of these antecedents. Cognitive science has demonstrated how attitudes and beliefs that are expressed on the surface have their origins in deeper structures, in how we represent knowledge and how that knowledge is interrelated. That is, that knowledge does not exist as discrete “data” but rather is interconnected. To analyze these deeper structures, cognitive science has used methods such as causal maps, schemes and scripts. In this chapter we take into consideration cognitive scripts. As its name suggests, a script is “a cognitive mechanism that comprises the key elements in a situation decision and the likely ordering of events” (Krueger, 2003, p. 128-29), a “highly developed, sequentially ordered knowledge” that forms “an action-based knowledge structure (Mitchell et al., 2000 p.975). In the field of entrepreneurship the underlying assumption in this respect is that entrepreneurs possess a thought structure in relation to entrepreneurship that is significantly better than that of non-entrepreneurs (Lord & Maher, 1990). Script analysis has been considered primarily from the theory of expert information processing in order to examine differences between entrepreneurs and non-entrepreneurs as

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regards decision-making and is rooted in the following idea: entrepreneurs develop unique knowledge structures and they process (transform, store, recover and use) information differently from non-entrepreneurs (e.g., Mitchell, 1994; Mitchell et al., 2000). Thus, according to the theory of expert information processing, entrepreneurs are experts in the field of entrepreneurship and through deliberate practice (e.g., Baron & Henry, 2006; Mitchell, 2005) can acquire entrepreneurial cognitions; that is, scripts or knowledge structures that allow them to use the information significantly better than non-expert entrepreneurs. Although it has been shown that scripts are antecedent to the venture creation decision, little has been done in the way of analyzing how these scripts affect entrepreneurial intention. In our opinion it is reasonable to expect that these same entrepreneurial scripts are also antecedent to other previous steps in the process of business venture creation, such as the entrepreneurial intention. We thus suggest that there is a relation between scripts and entrepreneurial intention. The reasoning behind these expectations is consistent with the fact that those who have an entrepreneurial intention may not perceive starting a business as a risk, since what may be perceived as a risk by some individuals is not perceived as such by others (Simon et al., 2000). Thus, we suggest that scripts affect entrepreneurial intention. Given that individuals who work in specialized fields have unique knowledge, it is logical to expect that among a broad range of demographic groupings (e.g., age, culture, gender, etc.), the individuals who score high in these dimensions of cognitive scripts probably have similar thought patterns in regard to entrepreneurship and to this extent they can be differentiated from those who do not have an entrepreneurial intention. However, we also accept that, in some cases, the variance in the expected relation is not completely explained solely by inter-group analysis; there are often intra-group differences that can explain additional variance in this relation (Keppel, 1991). In the study of this relationship there are arguments that suggest the possibility of intra-group variance. Country of origin may be one possible explanation of intra-group variance. It is reasonable to expect that this intra-group variation in levels of entrepreneurial intention could be explained to the extent that perception is affected by the cultural values associated with the participants’ country of origin. Although it is well accepted that cultural values are an antecedent of human behaviour, they are also thought to affect the perceptions that precede that behaviour (Mitchell et al., 2000, 2002). Since each culture can have unique values and norms concerning the creation and running of business ventures, we can expect that entrepreneurial scripts may be culturally specific in their effects on entrepreneurial intention, given the differences in perception that emerge in the processes of engaging in creating an enterprise. Thus, we expect that, to the extent that there are cultural differences between countries, the effects of entrepreneurial scripts on entrepreneurial intention may be country-specific, and therefore we suggest that the effects of the scripts on entrepreneurial intention vary by country. In this context, the main objective of this chapter is to identify some of the cognitive elements that may explain differences in start-up intentions. The chapter proceeds in the following manner. First, we discuss the central research question to further enable entrepreneurial cognition inquiry. Second, we present the conceptual background and

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several representative approaches to entrepreneurial cognition research that form the context for this question. Third, we introduce the empirical analysis carried out to examine the relationships between cognitive scripts and intention, by comparing diverse sociocultural background. Finally, we offer the results and conclusions concerning the challenges facing the next generation of entrepreneurial cognition and intention. Thus, this chapter seeks to contribute toward redressing this gap in our knowledge by empirically testing a model that draws on the theory of planned behaviour to examine the cognitive antecedents of entrepreneurial intentions among students.

2. Entrepreneurial intention Psychologists have claimed that assessment of intentions is the most obvious way of predicting the behaviour (eg. Ajzen, 1991). In various situations, intentions have been considered as the most effective predictor of behaviours, such as job search activities and career choice (Kolvereid, 1996). In the entrepreneurship context, behaviours as new ventures, creation of new values are outcomes of entrepreneurial intentions (Bird, 1988). Thus, the entrepreneurial intention has been considered as the key element to understand the new-firm creation process. In this sense, entrepreneurial research has been conducted following two main lines: the personal characteristics or traits of the entrepreneur (eg. Zhao et al, 2005); and the influence of contextual factors (e.g. political and social context, markets, industry opportunities, and financial support, Franke & Luthje, 2003) in entrepreneurship (Robinson et al. 1991). However, these lines have a limited understanding of the processes through which entrepreneurial intentions develop and come into existence (Markman et al., 2002). Fini et al. (2009) identified several explanations a) the research in this area has an empirical orientation with scant theoretical contribution; and b) many studies have considered isolated variables, often without a clear theoretical rationale, as drivers of entrepreneurial intentions (Zhao et al., 2005). That is, predicting entrepreneurial intentions by modelling only individual or contextual factors as isolated domains usually resulted in disappointingly small explanatory power and even smaller predictive validity (Krueger, 2000). To address these limitations, some authors have undertaken a multi-disciplinary approach, adopting the so-called process models (or intention models). Historically, the first widely accepted model was the theory of reasoned action (TRA, Ajzen & Fishbein, 1980). Later, was called the theory of planned behaviour (TPB). Thus, according to Ajzen, intentions are explained by: a) subject’s attitudes (perceptions of personal desirability of performing the behaviour); b) social norms (the approval or disapproval that important referent individuals -or groups- have in relation to the enactment of a given behaviour); and c) perceived behavioural control (the perception that the target behaviour is within the decision maker’s control). According to the theory, attitudes, subjective norms and perceived control predict intentions, while intentions and perceived control predict behaviour. The TPB (Figure 1) is the most used model of the human intentions to this day (Ajzen, 1987, 2002). Another well recognized model is the Shapero’s entrepreneurial event model (SEE), that is conceptually similar to Ajzen’s theory of planned behaviour. In this model, entrepreneurial intentions depend on three elements: a) the perception of the desirability; b) the perception

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of feasibility; and c) the propensity to act (Shapero, 1982; Shapero and Sokol 1982). The perceived desirability is defined as the attractiveness of starting a business, perceived feasibility as the degree to which the individual feels capable of starting a business, and propensity to act as the personal disposition to act one one’s decisions.

Fig. 1. Ajzen’s Theory of Planned Behaviour While the SEE model was developed to understand entrepreneurial intention and behaviour, Ajzen’s TPB was developed to explain individual behaviour in general. According to the TPB attitudes, subjective norms and perceived behavioural control determine intentions. Intentions, in turn, along with perceived behavioural control determine actual behaviour. Empirical testing of entrepreneurial intentions among students has found support for both the SEE model and the TPB (Kolvereid, 1996; Krueger, 2000). Krueger (1993) argued that attitude in the TPB encompasses the notion of perceived desirability in the SEE model. He also argued that subjective norm overlaps with the notion of desirability and feasibility, and that feasibility overlaps with perceived behavioural control. Bagozzi (1992) suggested that attitudes may first be translated into desires, which then develop into intentions to act, which direct action. Armitage & Conner (2001) speculated that desires would inform intentions, upon which behavioural self-predictions are partly based. They argued, however, that further work is needed to test the causal relationship between desires, intentions, and self-predictions. Another model of intentions was developed by Bird (1988) which considers that entrepreneurial intentions are based on a combination of both personal and contextual factors. Further development of the Bird’s model was made by Boyd & Vozikis (1994) to include the concept of self-efficacy taken from the social learning theory. Another model was proposed by Davidsson (1995), which suggested that entrepreneurial intentions can be influenced by: conviction, defined by general attitudes (change, compete, money, achievement, and autonomy) and domain attitudes (payoff, societal contribution and know how); conviction, in turn, is related to personal variables including age, gender, education, vicarious experience and radical change experience. Different studies have been conducted around the models described above (see e.g. Audet, 2002; Boyd & Vozikis, 1994; Davidsson, 1995; Peterman & Kennedy, 2003; Souitaris et al., 2007). However, none of these models and studies have considered cognitive variables as variables that can influence and determine the entrepreneurial intention.

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3. The cognitive approach The cognitive approach uses the cognitive aspects of entrepreneurs to study and even to explain their behaviour, which is related to the identification of opportunities for the creation of businesses and business growth. In fact the term "cognitive style" is used to characterize certain ways of processing information related to entrepreneurial behaviour. Two main lines can be differentiated within the cognitive literature: the study of cognitive structures and the study of cognitive processes (Sánchez et al., 2011). Some studies have attempted to identify the knowledge structures that entrepreneurs use to make assessments, judgments or decisions, in evaluating opportunities, and in the creation and growth of businesses (Boucknooghe et al., 2005; Gaglio & Katz, 2001; Mitchell et al., 2000). Other types of research are based on the idea that whatever the individual thinks, says or does is influenced by the cognitive processes through which individuals acquire, use and process information (Baron & Markman, 1999; Evans & Krueguer, 2004). This perspective suggests that entrepreneurs think and process information differently from non-entrepreneurs and such differences may help to distinguish people who create or aim to establish businesses (entrepreneurs) from people who do not create and will not create companies (nonentrepreneurs). Thus, some authors have coined the term "cognitive style" to characterize certain ways of processing information related to entrepreneurial behaviour (Baron, 2004; Boucknooghe et al., 2005). Cognitive psychology is not only an aid to understanding individuals and their behaviour, considering their mental processes when they interact with other people, but also addresses the environment in which these mental processes and interactions take place (Mitchell et al., 2002). The Theory of Social Cognition introduces the idea of knowledge structure; i.e. the mental models (cognitions) that are used to achieve personal effectiveness in certain situations. Thus, since entrepreneurship is defined as relating to individuals or teams that create products/services for other people, Cognitive Psychology is increasingly useful to help establish the phenomena associated with entrepreneurship (Sánchez, 2011b). In this sense, experts insist on the possibility of explaining a large part of entrepreneurial behaviour and its origin from both cognitive structural and process variables (e.g., Busenitz & Lau, 1996). Cognitive structures represent and contain knowledge, while cognitive processes relate to the manner in which that knowledge is received and used. In sum, the field of entrepreneurial cognition includes all aspects of cognition that can potentially play an important role in certain aspects of the entrepreneurial process. Thus, we shall address the main cognitive aspects reflected in the literature that shed light on the study of entrepreneurship. 3.1 Self-efficacy Originally defined by Bandura (1994, p. 72) as "one's beliefs in their abilities to perform a certain level of performance or desired outcomes that influence situations that affect their lives", self-efficacy has become an important variable considered in the cognitive study of entrepreneurial behaviour. Shane et al. (2003) emphasize self-efficacy as a robust predictor of individual outcome in a given activity and its validity to explain why people with equal skills may act differently.

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33

Like Chen et al. (1998), by entrepreneurial self-efficacy we understand the self belief in one’s ability to adopt the role and conduct the tasks of an entrepreneur successfully. Thus, research on self-efficacy in entrepreneurial behaviour has been characterized by making distinctions between entrepreneurs and non-entrepreneurs (Chen et al., 1998; Markman et al., 2005). In a given situation, entrepreneurs perceive more opportunities than those who have low levels of entrepreneurial self-efficacy, who perceive the same situation to have more costs and greater risks (Cooper & Lucas, 2005; Vecchio, 2003). People who have a higher level of self-efficacy also feel more competent to overcome perceived obstacles and they anticipate more positive results (Vecchio, 2003) and persist in the effective search and organization of activities in the midst of uncertainty (Trevelyan, 2009). Entrepreneurial self-efficacy enables us to differentiate entrepreneurs from managers and it also correlates with the intention of owning a business, pointing to the notion that the individual who believes or feels him or herself most capable of undertaking a business concern is more prone to implementing such behaviour than one who does not feel able to do so (Chen et al., 1998). Self-efficacy can also be used to identify the reasons why some individuals avoid becoming entrepreneurs, since some people avoid entrepreneurial activities not because of their lack of ability but because they believe that they do not have such ability. Moreover, it can be used to identify areas of weakness or strength for developing the entrepreneurial potential of individuals or communities and to improve the performance of existing entrepreneurs (Chen et al., 1998). Further, entrepreneurial self-efficacy studies provide data that help to understand why some businesses do not grow, on the grounds that some entrepreneurs have insufficient selfefficacy to cope with specific tasks (Vecchio, 2003). All these contributions have lent considerable impetus to clarifying the cognitive study of entrepreneurs. Accordingly, it is crucial to focus on possible factors that might influence the development of self-efficacy. For example, Oliveira et al. (2005), seeking to identify the impact of the social environment on the self-efficacy beliefs of entrepreneurs, reported that those who had a favourable micro-social environment (support from family and friends) had higher levels of self-efficacy than those who had an unfavourable micro-social environment. Similarly, Krueger and Kickul (2006) argued that individuals assess their entrepreneurial skills in reference to perceived resources, opportunities, and obstacles in the environment; thus, the environment exerts an impact on entrepreneurial self-efficacy. 3.2 Scripts The area of scripts has expanded considerably and has provided fruitful results in the field of entrepreneurship, mainly thanks to Ron Mitchell and colleagues. Like Fiske & Taylor (1991), we define a script (schema) as a cognitive structure of beliefs and standards concerning a given domain of stimulus, which provides the individual with a reference point from which to represent his or her environment and provides guidelines for action and decision making. This cognitive structure represents the organized knowledge that a person has about a particular concept and contains information about the attributes of this concept and about the relationships between such attributes (Busenitz & Lau, 1996). Within the context of entrepreneurship, scripts are considered to refer to the knowledge structures that entrepreneurs use to make assessments, judgments or decisions regarding

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Entrepreneurship – Born, Made and Educated

the assessment of opportunities, enterprise creation and business growth. In other words, research on entrepreneurial scripts refers to the study of how entrepreneurs use simplified mental models to link previously unconnected information that will help them to identify or invent new products or services and the necessary resources to start up and cultivate a business (Mitchell et al., 2002). Thus, scripts in the field of entrepreneurship are knowledge structures that individuals have concerning the actions themselves to be undertaken (Busenitz & Lau, 1996). The main contribution of these studies suggests that expert entrepreneurs think differently from novices. The way in which entrepreneurial experts become experts is reflected in the development of an expert script. Experts have knowledge structures or scripts about a particular domain that allow them to perform better in their environment than non-experts, who neither have nor use structured knowledge (Mitchell et al., 2000; Westhead et al., 2009). This contribution extends to the intercultural level. Several cross-cultural studies have shown that knowledge structures differentiate between entrepreneurs and nonentrepreneurs in different countries (Mitchell et al., 2002; Smith et al., 2009). The explanation is that entrepreneurs have shared experiences about the conceptualization, early development and growth of new businesses, leading them to develop similar and more refined mental models than non-experts might have, given their reduced experience in the domain (Mitchell et al., 2002, Smith et al., 2009). Moreover, script studies provide clues to understanding the functioning of entrepreneurs in a group. Scripts are manifested not only individually, but are also manifested in a team. Although teams do not have cognitions alone, the prospects of the team about what is an appropriate action (schema) are significantly greater than the collection of individual perspectives, and the collective cognition of the entrepreneurial team is what drives many strategic business decisions (West, 2007). 3.3 Cognitive styles Cognitive style is defined as the way people perceive environmental stimuli, and how they organize and use information from their environment to guide their actions. In their study, Boucknooghe et al. (2005) raised the following questions: “What is the cognitive style of entrepreneurs?” Is the way they perceive, organize and use environmental information different from the way non-entrepreneurs do? The results of that investigation confirmed the notion that entrepreneurs differ in their cognitive styles. Successful entrepreneurs enjoy discovering opportunities, being innovators and taking risks, as do inventors. Individuals who use a knowing style (analytical and conceptual) look for facts and data. They want to know exactly how things are, and they tend to retain many facts and details. They are task-oriented and accurate, and they thrive on complex problems if they can find a clear and rational solution. The creative style is characterized by holistic and conceptual thinking. Individuals who use this style tend to be creative and enjoy experimentation. They tend to see opportunities and challenges. They do not like rules and procedures, and take pleasure in uncertainty and freedom. They are ambitious and achievement-oriented. Successful entrepreneurs show more originality than others and are able to produce solutions that run against established knowledge. Creative thinking also facilitates the recognition of business opportunities (Bridge et al., 2003). The integration of

Entrepreneurial Intentions: The Role of the Cognitive Variables

35

both analytic (knowing) and intuitive (creative) processing styles is required to process information (Hodgkinson & Sparrow, 2002) and minimizes the dangers of cognitive biases identified by researchers into behavioural decisions (e.g. Mintzberg, 1994; Sinclair et al., 2002). In addition, other research has shown that entrepreneurs collect, process and evaluate information in a more intuitive manner than managers, middle managers and initiates. Senior managers have cognitive styles similar to those of entrepreneurs (Allison et al., 2000). Recently, Lindblom et al. (2008) have found differences in the cognitive style of the different types of entrepreneurs. Those authors investigated the cognitive style of retail entrepreneurs with respect to marketing decisions. The results revealed that the cognitive style of retail entrepreneurs is more consistent with the style of employees than with that of other entrepreneurs. 3.4 Decision making: Heuristics and errors Research on heuristics has afforded important results in our understanding of the cognitive functioning of human beings in general and of entrepreneurs in particular. Heuristics are simplifying strategies that individuals use to manage information and reduce uncertainty in decision making (Khaneman & Tversky, 1973). Research has shown that entrepreneurs with a logic based on heuristics are able to make sense of complex and ambiguous situations more quickly and take more orthodox approaches in making decisions (Mittchel et al. 2009). However, other studies (Baron & Markman, 1999) have shown that the use of certain cognitive heuristics leads to biases and errors, as discussed below. Counterfactual thinking. This is understood as an afterthought in decision-making in which the procedures followed to perform the task are discussed, and various alternatives that could have been followed are considered (Wadeson, 2006). These are the thoughts that occur due to adverse outcomes or wrong expectations (Markman et al., 2005). Counterfactual thinking has positive and negative effects on the entrepreneur. On the one hand, it can lead to regret and can reduce perceived self-efficacy if one decides the choice was not the best one. On the other hand, counterfactual thinking can lead to the formation of alternative strategies for the future, so the best strategies can be learned from experience. In the field of entrepreneurship, research that has analyzed counterfactual thinking reveals that entrepreneurs are less likely to engage in counterfactual thinking, they regret missed opportunities less and bear past mistakes more easily, both their own and those of others (Baron, 2000). Another important contribution was a study by Gaglio and Katz (2001), who hypothesize that people on entrepreneurial alert are involved in counterfactual thinking, unravelling the causal sequences. Therefore, they are more likely to increase the complexity of their mental patterns, changing in response to novel events. A further discussion of the role of counterfactual thinking and its importance in entrepreneurship can be found in Gaglio’s work (2004). The planning fallacy. The planning fallacy is a cognitive aspect related to errors in planning, that is, the tendency to believe that one can achieve more in a given period of time than one

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Entrepreneurship – Born, Made and Educated

is really is capable of. The planning fallacy is the result of people failing to break down multifaceted mental tasks into their different components (Evans & Krueguer, 2004). Thus, when people are asked to break down the tasks to be performed, the planning fallacy becomes reduced. Most people, including entrepreneurs, tend to overestimate how much they can accomplish in a given period of time and may underestimate the amount of resources needed to complete certain projects (Baron & Markman, 1999). These authors defended the idea that entrepreneurs tend to be more susceptible to the planning fallacy than other people, because they operate in a dynamic and uncertain environment, under the severe pressure of time and large amounts of information. However, the results have shown the opposite, i.e. that entrepreneurs are less prone to the planning fallacy (Baron & Markman, 1999). Overconfidence. Over-confidence refers to the tendency of thinking one knows more than what one really knows (Baron & Markman, 1999). That is, our failure to know the limits of our own knowledge. Over-confidence occurs when decision makers’ assessments are overly optimistic. In sum, overconfident people are characterized by poor meta-cognition. According to Russo & Schoemaker (1992), overconfidence may be the result of the availability heuristic, the anchoring and adjustment heuristic, confirmatory bias, and hindsight bias. The confirmation bias is a tendency to gather evidence for and assign more weight to information that confirms one’s belief, and to stop seeking or to ignore dissonant information. Hindsight bias is a tendency to see past events as more predictable than they actually were, such as the familiar saying: "I knew it." It is important to realize that to collect less information when a person is feeling very safe is not really a heuristic, but something rational. However, if the confidence level is not justified, then it will fail in the collection of information. Over optimism. This is the tendency to believe that things will work out. Overoptimism has three main forms (Brown & Taylor, 1988): positive self-evaluation, optimism about plans and future events and over-optimism due to the illusion of control bias. Cooper et al. (1988) found that 81% of entrepreneurs interviewed believed that their chances of success would be at least 70% and 33% claimed that they were destined for success. However, reality showed that only 25% of new businesses survive for more than five years. Such positive statements partly reflect a need for self justification. The authors suggest that entrepreneurs can start a psychological phenomenon called post-decisional reinforcing, in which decision makers tend to exaggerate the attractiveness of an option once it has been chosen. They also advance the possibility that employers may have a natural tendency to talk positively about their efforts as an incentive to encourage others, such as financiers, employees and customers into believing they will be successful. If employers are more optimistic when they decide to start a business, then this has additional implications in comparison to a situation in which one is only over-optimistic after the initial decision. According to Vecchio (2003), there are studies that have identified highly secure entrepreneurs and managers of small businesses. He cites the discovery of Cooper et al. (1988) that entrepreneurs express a high level of confidence in success. Also, Parker (2006) argues that certain findings in the psychology literature suggest that entrepreneurs are particularly over-optimistic. It is this optimism that tends to be greater when individuals have emotional commitment to the results of their work.

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Bernardo & Welch (2001) found that by providing positive information externally to their social group, over-confident entrepreneurs are more preferred by their environment. If these externalities are significant enough, then social welfare will be increased through having some over-confident people in the population, even though such people are not behaving in an optimal way as regards their own welfare. This has important implications and applications for the workplace, and suggests that the inclusion of over-confident workers in the company will have beneficial effects on work climate, self-efficacy, performance, etc. In conclusion, the relationship between different heuristics is established: overconfidence, as defined above, leads to incorrect estimates of the risks that an entrepreneur has to face, but the estimates could go in two directions: either being too pessimistic or too favourable, depending on whether the estimate is positively or negatively biased. However, it is quite possible that people who are optimistic enough to start a business show a tendency towards the overconfidence bias in the direction of underestimating the risk they face. Similarly, the belief in the law of small quantities can lead to over-confidence if the small sample used is biased in a positive direction. The anchor could lead to overoptimism about the creation and progress of a company, in cases where the expectations based on indications of the progress made so far are too optimistic.

4. The study In the field of entrepreneurship, three types of entrepreneurial scripts have gradually been defined: arrangements, willingness, and ability scripts (e.g., Mitchell, 1994; Mitchell et al., 2000, 2002). Arrangements scripts are the knowledge structures that individuals have about the contacts, relations, resources, and assets that are needed for economic relations. Willingness scripts are the knowledge structures underlying the idea of engaging in an economic relation. Ability scripts are the knowledge structures that individuals have about the capabilities, skills, knowledge, norms, and attitudes needed to create a business venture. Although it has been shown that entrepreneurial arrangements, willingness, and ability scripts are antecedent to the venture creation decision, little has been done in the way of analyzing how these scripts affect entrepreneurial intention. In our opinion it is reasonable to expect that these same entrepreneurial scripts are also antecedent to other previous steps in the process of business venture creation, such as the entrepreneurial intention. We thus suggest that there is a relation between arrangements, willingness, and ability scripts and entrepreneurial intention. Consistent with previous research (Mitchel et al., 2000), we argue that people who are able to: a) use arrangements scripts most suitably in relation to the idea of protection, resource possession, venture networks, and venture specific skills; b) possess more developed willingness scripts with respect to their opportunity seeking focus, opportunity motivation, and risk tolerance; and c) trust in their ability scripts to diagnose the conditions and potential to create business ventures, see the need and create value and apply the lessons learned to a variety of experiences (Abelson & Leddo, 1986) will have a higher entrepreneurial intention. The reasoning behind these expectations is consistent with the fact that those who have an entrepreneurial intention may not perceive starting a business as a risk, since what may be

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Entrepreneurship – Born, Made and Educated

perceived as a risk by some individuals is not perceived as such by others (Simon et al., 2000). Thus, we suggest that scripts affect entrepreneurial intention. Given that individuals who work in specialized fields have unique knowledge, it is logical to expect that among a broad range of demographic groupings (e.g., age, culture, gender, etc.), the individuals who score high in these dimensions of cognitive scripts probably have similar thought patterns in regard to entrepreneurship and to this extent they can be differentiated from those who do not have an entrepreneurial intention. In short, we expect to find that: High scores in arrangements, willingness, and ability scripts are positively related to high scores in entrepreneurial intention (proposal 1). However, we also accept that, in some cases, the variance in the expected relation is not completely explained solely by inter-group analysis; there are often intra-group differences that can explain additional variance in this relation (Keppel, 1991). In the study of this relationship there are arguments that suggest the possibility of intra-group variance. Country of origin may be one possible explanation of intra-group variance. It is reasonable to expect that this intra-group variation in levels of entrepreneurial intention could be explained to the extent that perception is affected by the cultural values associated with the participants’ country of origin. Although it is well accepted that cultural values are an antecedent of human behaviour, they are also thought to affect the perceptions that precede that behaviour (Mitchell et al., 2000; Mitchell et al., 2002). Since each culture can have unique values and norms concerning the creation and running of business ventures, we can expect that entrepreneurial scripts may be culturally specific in their effects on entrepreneurial intention, given the differences in perception that emerge in the processes of engaging in creating an enterprise. Thus, we expect that, to the extent that there are cultural differences between countries, the effects of entrepreneurial scripts on entrepreneurial intention may be country-specific, and therefore we suggest that: The effects of the arrangements, willingness, and ability scripts on entrepreneurial intention vary by country (proposal 2). The data were collected from a sample of 726 university students, 266 of them from Mexico, 252 from Italy, and 208 from Spain. Approximately 64.2% of the surveyed participants were women. Participants’ ages ranged between 19 and 24, with a mean age of 21.24 (Sd=3.32) in the Mexican sample, 21.9 (Sd=3.09) in the Italian sample, and 21.09 (Sd=2.90) in the Spanish sample. No differences were found among the participants from Mexico, Italy or Spain regarding age and sex. The level of formal education was also similar among the different countries. Although education is not theoretically linked to entrepreneurial cognition or intention (Fischer & Reuber, 1994) it can limit the clarity of the variance explained by the cognitive scripts and was thus entered as a control variable when examining the proposals. 4.1 Measures The participants responded to 4 items concerning intentions to start their own business (dependent variable). The responses were categorized on a 0 (very unlikely) to 5 (very likely) point Likert-type scale. An index of intention to become self-employed was created by averaging the four item-scores. Our data confirmed the reliability of the scale (=0.75), which exceeds the Nunnally (1978) criterion of .70 for scale reliability in exploratory research.

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The scales used to measure scripts (independent variables) were adopted from Mitchell et al. (2000; 2002). Items from the original scales were translated into Spanish and Italian using a translation/back-translation procedure (Behling & Law, 2000). Mitchell et al. (2000; 2002) developed 27 items to measure entrepreneurial scripts indirectly, following an accepted script-scenario construction model proposed by Read (1987). In this approach, the existence and degree of mastery of scripts is inferred based on selection by respondents from paired response choices; one represents expertise and the other is a distracter cue. When solving problems within a specific domain, experts are able to select the response consistent with their expert scripts (Glaser, 1984), whereas non-experts are more likely to choose the socially desirable distracter cue (Crowne & Marlowe, 1964). The arrangements scripts scale is comprised of 7 items regarding the contacts, relationships, resources, and assets necessary to engage in entrepreneurial activity. The willingness scripts scale includes 9 items about engaging in venturing and receptivity to the idea of starting a new venture. Finally, the ability scripts scale is composed of 11 items regarding the capabilities, skills, knowledge, norms, and attitudes required for venture creation. All items ask the participants to choose between an expert script (coded as “1”) and a distracter cue (coded as “0”). Responses in each script scale are used as formative indicators and summed into interval scales (Nunnally, 1978) indicating the likelihood or strength of script possession. 4.2 Data analysis Before testing the proposals, and following the recommendations of Mitchell et al. (2000; 2002), a factor analysis was run (principle components analysis, using an eigenvalue of 1 and varimax rotation) to confirm the dimensionality of each of the script constructs. Proposal 1 was tested using analysis of co-variance (ANCOVA), with education and country of origin as the co-variants. Proposal 2 was tested using multivariate analysis of variance (MANOVA) and hierarchical regression analysis. Since ANCOVA requires categorical variables, the scales used to measure arrangements, willingness, and ability were recoded in three categories of approximately the same size - low, intermediate, and high (each category contained at least 20% of the participants surveyed). The mean values of each scale were assigned to the intermediate category and at least two values for each of the low and high categories. These three categories were chosen to minimize the loss of explanatory power in the categorization processes, maintaining groups of sufficient size to fulfill the analytical suppositions. To test proposal 2 we used the original independent variables (interval scale) in the hierarchical regression analysis. Hierarchical regression analysis checks the ANCOVA results using the information provided by the measures. 4.3 Results Support was found for the dimensions conceptualized in the work of Mitchell et al. (2000; 2002) regarding scripts. Although some items showed high loadings on several factors they were not eliminated from the analysis and were assigned to the factor most related to the theoretical content of the subscale. The items assigned to each factor were averaged to obtain the score of the participants in each of the script subscales.

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Entrepreneurship – Born, Made and Educated

After controlling for the effects of the education and country of origin variables, ANCOVA (Table 1a), showed that arrangements, willingness, and ability scripts explained 39% of the variance in entrepreneurial intention and these cognitive constructs explained 22% of the total variance when the effects of the education and country of origin variables were not taken into account. The main effects were all significant, thus confirming our first hypothesis: arrangements, willingness, and ability scripts are related to the level of entrepreneurial intention despite the participants’ country of origin and level of education. Similar results were found using hierarchical regression (Table 1c, all). To test our second proposal we performed a MANOVA (Table 1b). The results of this analysis indicate that the mean values of arrangements, willingness, and ability scripts were significantly different according to the countries studied. We found differences in arrangements and willingness between Spain/Italy and Mexico and in ability between Spain and Mexico. The rest of the comparisons were not found to be significant. These findings suggest that there may be some differences in scripts according to country, but that there can also be some similarities (e.g., between Spain and Italy). A regression analysis (Table 1c) was run in an attempt to understand the differential effects of the scripts on entrepreneurial intention. After controlling for the effects of the education and country of origin variables, ANCOVA (Table 1a), showed that arrangements, willingness, and ability scripts explained 39% of the variance in entrepreneurial intention and these cognitive constructs explained 22% of the total variance when the effects of the education and country of origin variables were not taken into account. The main effects were all significant, thus confirming our first hypothesis: arrangements, willingness, and ability scripts are related to the level of entrepreneurial intention despite the participants’ country of origin and level of education. Similar results were found using hierarchical regression (Table 1c, all). To test our second proposal we performed a MANOVA (Table 1b). The results of this analysis indicate that the mean values of arrangements, willingness, and ability scripts were significantly different according to the countries studied. We found differences in arrangements and willingness between Spain/Italy and Mexico and in ability between Spain and Mexico. The rest of the comparisons were not found to be significant. These findings suggest that there may be some differences in scripts according to country, but that there can also be some similarities (e.g., between Spain and Italy). A regression analysis (Table 1c) was run in an attempt to understand the differential effects of the scripts on entrepreneurial intention. The results of this analysis indicate that the mean values of the arrangements, willingness and ability scripts were significantly different according to the countries under study. Post hoc analyses showed differences between Spain/Italy and Mexico in Arrangement and Willingness scripts and between Spain and Mexico in Ability. No differences were found between Spain and Italy in any of the cognitive scripts. These results suggest that country differences exist in the content of entrepreneurial scripts, but that there are also similarities. We therefore performed a hierarchical regression analysis to understand the potential effects of the scripts on entrepreneurial intention (Table 1c).

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Entrepreneurial Intentions: The Role of the Cognitive Variables A. Hypothesis 1 – ANCOVA†

B. Hypothesis 2 - MANOVA

C. Hypothesis 2 Hierarchical Regression‡

Univariate F’s MS

F

p

Covariates 141.4 357.5 .000 Formation Country

3,97 10,05 .002

Country effect Arrangements

29,23 73,91 .000 Willingness

Main effects Arrange15,94 40,31 .000 ments Willingness 1,40 3,54 .029 Ability 1,80 4,56 .011

Ability

Multivariate F

Wilkes’ lambda p

5,54

.000

F

p

All

Spain Italy Mexico

Formation ,211*** ,122* ,128* ,272*** 14,68 ,000 9,46 ,000 3,65 ,026

Scripts model Arrangements

,281*** ,261* ,272*** ,240**

Willingness ,209***

,110 ,212** ,242**

Ability Formation

,077* ,116**

,100 ,086

,109* ,056

,044***

,015

,012* ,074***

R2 (base model)  R2

,013 ,156*

,253*** ,149*** ,225*** ,251***

Table 1. Hypothesis Tests The Chow Test turned out to be significant, and thus there are significant differences between the models at country level and the overall model. No script was significant in the sample of Spanish participants, whereas they were all significant for the sample of Italian participants. The results of the MANOVA and the regression analysis indicate that although the arrangements, willingness, and ability scripts are related to entrepreneurial intention, there are nevertheless certain differences between the countries. To analyze these differences we examined the relation between the attributes of the cognitive scripts and entrepreneurial intention, performing a post hoc hierarchical regression and considering the attributes of the scripts within each country. The results of this hierarchical analysis are shown in Table 2a. The arrangements scripts block of variables were significant for Spain, Italy and Mexico, explaining, respectively, 7%, 16%, and 14% more of the variance in entrepreneurial intention. All of the subscales were significant in the three countries. The willingness scripts block of variables is significantly related to entrepreneurial intention in all three countries, explaining, respectively, 5%, 2%, and 6% more of the variance in entrepreneurial intention than the base model, education. Seeking focus was significant for Italy and Mexico. Risk tolerance was significant for Spain and Mexico whereas Opportunity motivation was not significant in any of the countries. The ability script block was only significant for Mexico, explaining 3% more of the variance than the base model (education). The total effects of the script constructs were examined in a stepwise regression (Table 2b) in order to identify the most salient scripts in each country. Resource possession (arrangement) and venture specific skills (arrangement) were significantly related to entrepreneurial intention in all three countries. Protectable idea (arrangement) was significant (p