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Variable risk preferences in new firm growth and survival

Wennberg, Karl; Delmar, Frédéric LU and McKelvie, Alexander (2016) In Journal of Business Venturing 31(4). p.408-427
Abstract (Swedish)
We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs’ attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures’ probability of exit and growth diminishing with age... (More)
We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs’ attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures’ probability of exit and growth diminishing with age and size. (Less)
Abstract
We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs' attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures' probability of exit and growth diminishing with age... (More)
We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs' attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures' probability of exit and growth diminishing with age and size. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
entreprenörskap, tillväxt, beslutsfattande, Growth , Survival , Aspiration levels , Focus of attention , New ventures, Risk preferences
in
Journal of Business Venturing
volume
31
issue
4
pages
408 - 427
publisher
Elsevier
external identifiers
  • scopus:84969253495
  • wos:000379630800003
ISSN
0883-9026
DOI
10.1016/j.jbusvent.2016.05.001
language
English
LU publication?
yes
id
4ccbd4ab-f141-484d-848f-f56959bd76f2
date added to LUP
2016-05-25 14:00:31
date last changed
2017-09-18 11:28:55
@article{4ccbd4ab-f141-484d-848f-f56959bd76f2,
  abstract     = {We outline and test a decision-making theory of new venture growth and survival. Building upon research in entrepreneurship and decision making under risk, we hypothesize that entrepreneurs' attention to survival and aspiration reference points changes based on venture age (experience-based learning), size (differences in decision complexity), and performance decision domain. Examining a panel of 14,760 new ventures in the professional services sector, our findings show how risk preferences change as a venture ages and increases in size. This approach offers a more nuanced view of decision making under risk and provides a theoretical explanation for the common patterns of new ventures' probability of exit and growth diminishing with age and size.},
  author       = {Wennberg, Karl and Delmar, Frédéric and McKelvie, Alexander},
  issn         = {0883-9026},
  keyword      = {entreprenörskap,tillväxt,beslutsfattande,Growth , Survival     ,Aspiration levels , Focus of attention       ,New ventures,Risk preferences},
  language     = {eng},
  number       = {4},
  pages        = {408--427},
  publisher    = {Elsevier},
  series       = {Journal of Business Venturing},
  title        = {Variable risk preferences in new firm growth and survival},
  url          = {http://dx.doi.org/10.1016/j.jbusvent.2016.05.001},
  volume       = {31},
  year         = {2016},
}