The Origins and Extent of Entrepreneurial Action-Orientedness: An Experimental Study

47 Pages Posted: 17 Jan 2017

See all articles by Ahmad Barirani

Ahmad Barirani

Copenhagen Business School - Department of Innovation and Organizational Economics

Randolph Sloof

University of Amsterdam - Faculty of Economics & Business (FEB); Tinbergen Institute

Mirjam van Praag

University of Amsterdam - Department of Economics; Copenhagen Business School; Tinbergen Institute; IZA Institute of Labor Economics

Multiple version iconThere are 3 versions of this paper

Date Written: January 2017

Abstract

We test the hypothesis, based on popular and theoretical perspectives, that entrepreneurs are more action-oriented than other occupational groups. We compare their playing strategies in an optimal stopping game using a randomized online experiment among 100s of entrepreneurs, managers and employees. Our experimental results show that entrepreneurs are indeed more action-oriented than others. We theorize that this is driven by their lower levels of loss aversion and higher levels of curiosity. Our empirical test results show that (i) entrepreneurs score indeed higher, on average, than managers and employees on curiosity and lower on loss aversion; (ii) the difference in action-orientedness between entrepreneurs and others vanishes when controlling for individual curiosity levels and (iii) an alternative treatment that provides subjects with counterfactual information (about what would have happened in case of stopping) increases their willingness to stop. Under some assumptions, the combination of these results leads to the conclusion that the higher action-oriented entrepreneurs can be linked to their greater curiosity, but not to their lower level of loss aversion. Hence, we find support for the intuitive idea that (curiosity driven) action-orientedness enhances the identification and/or exploitation of opportunities.

Keywords: Curiosity, Employees, Entrepreneurs, Inaction, Lab-in-the field experiment, loss aversion, Managers

JEL Classification: C93, D03, L26

Suggested Citation

Barirani, Ahmad and Sloof, Randolph and van Praag, Mirjam and van Praag, Mirjam, The Origins and Extent of Entrepreneurial Action-Orientedness: An Experimental Study (January 2017). CEPR Discussion Paper No. DP11771, Available at SSRN: https://ssrn.com/abstract=2900188

Ahmad Barirani (Contact Author)

Copenhagen Business School - Department of Innovation and Organizational Economics ( email )

Kilevej 14A
Frederiksberg, 2000
Denmark

Randolph Sloof

University of Amsterdam - Faculty of Economics & Business (FEB) ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands
+31 20 525 5241 (Phone)
+31 20 525 4310 (Fax)

Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Mirjam Van Praag

Copenhagen Business School ( email )

Kilevej 14A
Frederiksberg, 2000
Denmark

University of Amsterdam - Department of Economics ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands
+31 20 525 4096 (Phone)
+31 20 525 4182 (Fax)

Tinbergen Institute

Gustav Mahlerlaan
Amsterdam
Netherlands

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

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