IDEAS home Printed from https://ideas.repec.org/a/sae/jouent/v31y2022i1p153-183.html
   My bibliography  Save this article

Entrepreneurial Self-efficacy and Financial and Calculation Skills Can Shape Different Profiles of Venture Intentions

Author

Listed:
  • Elisabet Ruiz-Dotras
  • Josep Lladós-Masllorens

Abstract

The complexity of finances and access to financial markets is one of the main challenges facing an entrepreneur. However, not many studies examine the effect of financial skills on entrepreneurial intentions. Our research describes venture intentions, considering motivations, contextual factors and personal traits in different clusters, based on the strong sense of entrepreneurial self-efficacy and the levels of financial literacy and numeracy skills. Results demonstrate that financial and numeracy skills and self-efficacy shape different profiles of potential entrepreneurs. The study shows that social motivations exert a favourable impact on entrepreneurial intentions only for those who firmly believe in their abilities or have high financial and numeracy skills. For those without outstanding skills or high self-efficacy, contextual factors play a key role in the decision to launch a new venture.

Suggested Citation

  • Elisabet Ruiz-Dotras & Josep Lladós-Masllorens, 2022. "Entrepreneurial Self-efficacy and Financial and Calculation Skills Can Shape Different Profiles of Venture Intentions," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 31(1), pages 153-183, March.
    • Handle: RePEc:sae:jouent:v:31:y:2022:i:1:p:153-183
    DOI: 10.1177/09713557211069319
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/09713557211069319
    Download Restriction: no
    File URL: https://libkey.io/10.1177/09713557211069319?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Saulo Dubard Barbosa & Megan Gerhardt & Jill Kickul, 2007. "The Role of Cognitive Style and Risk Preference on Entrepreneurial Self-Efficacy and Entrepreneurial Intentions," Post-Print hal-02312750, HAL.
    2. Forlani, David & Mullins, John W., 2000. "Perceived risks and choices in entrepreneurs' new venture decisions," Journal of Business Venturing, Elsevier, vol. 15(4), pages 305-322, July.
    3. van Rooij, Maarten & Lusardi, Annamaria & Alessie, Rob, 2011. "Financial literacy and stock market participation," Journal of Financial Economics, Elsevier, vol. 101(2), pages 449-472, August.
    4. Alejandro Drexler & Greg Fischer & Antoinette Schoar, 2014. "Keeping It Simple: Financial Literacy and Rules of Thumb," American Economic Journal: Applied Economics, American Economic Association, vol. 6(2), pages 1-31, April.
    5. Annamaria Lusardi & Olivia S. Mitchell, 2008. "Planning and Financial Literacy: How Do Women Fare?," American Economic Review, American Economic Association, vol. 98(2), pages 413-417, May.
    6. Annamaria Lusardi & Olivia S Mitchelli, 2007. "Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 42(1), pages 35-44, January.
    7. Hai Yap Teoh & See Liang Foo, 1997. "Moderating effects of tolerance for ambiguity and risktaking propensity on the role conflict-perceived performance relationship: Evidence from singaporean entrepreneurs," Journal of Business Venturing, Elsevier, vol. 12(1), pages 67-81, January.
    8. Levent Altinay & Eser Altinay, 2006. "Determinants of ethnic minority entrepreneurial growth in the catering sector," The Service Industries Journal, Taylor & Francis Journals, vol. 26(2), pages 203-221, March.
    9. Lusardi, Annamaria & Tufano, Peter, 2015. "Debt literacy, financial experiences, and overindebtedness," Journal of Pension Economics and Finance, Cambridge University Press, vol. 14(4), pages 332-368, October.
    10. Ajzen, Icek, 1991. "The theory of planned behavior," Organizational Behavior and Human Decision Processes, Elsevier, vol. 50(2), pages 179-211, December.
    11. William Norton & William Moore, 2006. "The Influence of Entrepreneurial Risk Assessment on Venture Launch or Growth Decisions," Small Business Economics, Springer, vol. 26(3), pages 215-226, April.
    12. Maarten C.J. van Rooij & Annamaria Lusardi & Rob J.M. Alessie, 2012. "Financial Literacy, Retirement Planning and Household Wealth," Economic Journal, Royal Economic Society, vol. 122(560), pages 449-478, May.
    13. Annamaria Lusardi & Olivia S. Mitchell, 2011. "The Outlook for Financial Literacy," NBER Working Papers 17077, National Bureau of Economic Research, Inc.
    14. Christelis, Dimitris & Jappelli, Tullio & Padula, Mario, 2010. "Cognitive abilities and portfolio choice," European Economic Review, Elsevier, vol. 54(1), pages 18-38, January.
    15. Annamaria Lusardi & Olivia Mitchell, 2006. "Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education Programs," Working Papers wp144, University of Michigan, Michigan Retirement Research Center.
    16. Oladapo Rasul & Festus Victor Bekun & Seyi Saint Akadiri, 2017. "The Impact of Self-efficacy on International Student Entrepreneur Intention," International Review of Management and Marketing, Econjournals, vol. 7(1), pages 169-174.
    17. Kai Hockerts, 2017. "Determinants of Social Entrepreneurial Intentions," Entrepreneurship Theory and Practice, , vol. 41(1), pages 105-130, January.
    18. Annamaria Lusardi & Olivia S. Mitchell, 2014. "The Economic Importance of Financial Literacy: Theory and Evidence," Journal of Economic Literature, American Economic Association, vol. 52(1), pages 5-44, March.
    19. repec:ecj:econjl:v:122:y:2012:i::p:449-478 is not listed on IDEAS
    20. repec:cup:judgdm:v:5:y:2010:i:6:p:458-466 is not listed on IDEAS
    21. C. Praag & Peter Versloot, 2007. "What is the value of entrepreneurship? A review of recent research," Small Business Economics, Springer, vol. 29(4), pages 351-382, December.
    22. Engel, Yuval & Dimitrova, Nicoletta G. & Khapova, Svetlana N. & Elfring, Tom, 2014. "Uncertain but able: Entrepreneurial self-efficacy and novices׳ use of expert decision-logic under uncertainty," Journal of Business Venturing Insights, Elsevier, vol. 1, pages 12-17.
    23. Philipp Sieger & Marc Gruber & Emmanuelle Fauchart & Thomas Zellweger, 2016. "Measuring the social identity of entrepreneurs: Scale development and international validation," Post-Print hal-01725410, HAL.
    24. Lanny Herron & Harry J. Sapienza, 1992. "The Entrepreneur and the Initiation of New Venture Launch Activities," Entrepreneurship Theory and Practice, , vol. 17(1), pages 49-55, October.
    25. Sieger, Philipp & Gruber, Marc & Fauchart, Emmanuelle & Zellweger, Thomas, 2016. "Measuring the social identity of entrepreneurs: Scale development and international validation," Journal of Business Venturing, Elsevier, vol. 31(5), pages 542-572.
    26. Poh Wong & Yuen Ho & Erkko Autio, 2005. "Entrepreneurship, Innovation and Economic Growth: Evidence from GEM data," Small Business Economics, Springer, vol. 24(3), pages 335-350, January.
    27. Christopher W. Allinson & John Hayes, 1996. "The Cognitive Style Index: A Measure of Intuition‐Analysis For Organizational Research," Journal of Management Studies, Wiley Blackwell, vol. 33(1), pages 119-135, January.
    28. Florian Forster & Dietmar Grichnik, 2013. "Social Entrepreneurial Intention Formation of Corporate Volunteers," Journal of Social Entrepreneurship, Taylor & Francis Journals, vol. 4(2), pages 153-181, July.
    29. Vesa Puhakka, 2012. "Entrepreneurial Creativity as Discovery and Exploitation of Business Opportunities," Chapters, in: Thierry Burger-Helmchen (ed.), Entrepreneurship - Creativity and Innovative Business Models, IntechOpen.
    30. Roger Spear, 2006. "Social entrepreneurship: a different model?," International Journal of Social Economics, Emerald Group Publishing, vol. 33(5/6), pages 339-410, May.
    31. Bandura, Albert, 1991. "Social cognitive theory of self-regulation," Organizational Behavior and Human Decision Processes, Elsevier, vol. 50(2), pages 248-287, December.
    32. James Banks & Zoe Oldfield, 2007. "Understanding Pensions: Cognitive Function, Numerical Ability and Retirement Saving," Fiscal Studies, Institute for Fiscal Studies, vol. 28(2), pages 143-170, June.
    33. Teemu Kautonen & Marco van Gelderen & Matthias Fink, 2015. "Robustness of the Theory of Planned Behavior in Predicting Entrepreneurial Intentions and Actions," Entrepreneurship Theory and Practice, , vol. 39(3), pages 655-674, May.
    34. Shirokova, Galina & Osiyevskyy, Oleksiy & Bogatyreva, Karina, 2016. "Exploring the intention–behavior link in student entrepreneurship: Moderating effects of individual and environmental characteristics," European Management Journal, Elsevier, vol. 34(4), pages 386-399.
    35. Nancy G. Boyd & George S. Vozikis, 1994. "The Influence of Self-Efficacy on the Development of Entrepreneurial Intentions and Actions," Entrepreneurship Theory and Practice, , vol. 18(4), pages 63-77, July.
    36. A. Fayolle & B. Gailly, 2015. "The Impact of Entrepreneurship Education on Entrepreneurial Attitudes and Intention: Hysteresis and Persistence," Post-Print halshs-00785012, HAL.
    37. Inmaculada Jaén & Francisco Liñán, 2013. "Work values in a changing economic environment: the role of entrepreneurial capital," International Journal of Manpower, Emerald Group Publishing Limited, vol. 34(8), pages 939-960, November.
    38. Shane Frederick, 2005. "Cognitive Reflection and Decision Making," Journal of Economic Perspectives, American Economic Association, vol. 19(4), pages 25-42, Fall.
    39. Daniel J. Benjamin & Sebastian A. Brown & Jesse M. Shapiro, 2013. "Who Is ‘Behavioral’? Cognitive Ability And Anomalous Preferences," Journal of the European Economic Association, European Economic Association, vol. 11(6), pages 1231-1255, December.
    40. Landström, Hans & Harirchi, Gouya & Åström, Fredrik, 2012. "Entrepreneurship: Exploring the knowledge base," Research Policy, Elsevier, vol. 41(7), pages 1154-1181.
    41. Busenitz, Lowell W. & Barney, Jay B., 1997. "Differences between entrepreneurs and managers in large organizations: Biases and heuristics in strategic decision-making," Journal of Business Venturing, Elsevier, vol. 12(1), pages 9-30, January.
    42. Alain Fayolle & Benoît Gailly, 2015. "The Impact of Entrepreneurship Education on Entrepreneurial Attitudes and Intention : Hysteresis and Persistence," Post-Print hal-02312771, HAL.
    43. Pia Arenius & Maria Minniti, 2005. "Perceptual Variables and Nascent Entrepreneurship," Small Business Economics, Springer, vol. 24(3), pages 233-247, February.
    44. Lars Kolvereid, 1996. "Prediction of Employment Status Choice Intentions," Entrepreneurship Theory and Practice, , vol. 21(1), pages 47-58, October.
    45. repec:cup:judgdm:v:7:y:2012:i:1:p:25-47 is not listed on IDEAS
    46. Mitchell, Olivia S. & Lusardi, Annamaria (ed.), 2011. "Financial Literacy: Implications for Retirement Security and the Financial Marketplace," OUP Catalogue, Oxford University Press, number 9780199696819.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Shen, Chung-Hua & Lin, Shih-Jie & Tang, De-Piao & Hsiao, Yu-Jen, 2016. "The relationship between financial disputes and financial literacy," Pacific-Basin Finance Journal, Elsevier, vol. 36(C), pages 46-65.
    2. Florian Deuflhard & Dimitris Georgarakos & Roman Inderst, 2019. "Financial Literacy and Savings Account Returns," Journal of the European Economic Association, European Economic Association, vol. 17(1), pages 131-164.
    3. Azra Zaimovic & Anes Torlakovic & Almira Arnaut-Berilo & Tarik Zaimovic & Lejla Dedovic & Minela Nuhic Meskovic, 2023. "Mapping Financial Literacy: A Systematic Literature Review of Determinants and Recent Trends," Sustainability, MDPI, vol. 15(12), pages 1-30, June.
    4. Lusardi, Annamaria & Mitchell, Olivia S., 2011. "Financial literacy around the world: an overview," Journal of Pension Economics and Finance, Cambridge University Press, vol. 10(4), pages 497-508, October.
    5. Oscar A. Stolper & Andreas Walter, 2017. "Financial literacy, financial advice, and financial behavior," Journal of Business Economics, Springer, vol. 87(5), pages 581-643, July.
    6. Lührmann, Melanie & Serra-Garcia, Marta & Winter, Joachim, 2015. "Teaching teenagers in finance: Does it work?," Journal of Banking & Finance, Elsevier, vol. 54(C), pages 160-174.
    7. Aurora A. C. Teixeira & Rosa Portela Forte, 2017. "Prior education and entrepreneurial intentions: the differential impact of a wide range of fields of study," Review of Managerial Science, Springer, vol. 11(2), pages 353-394, March.
    8. Noemi Oggero & Maria Cristina Rossi & Elisa Ughetto, 2020. "Entrepreneurial spirits in women and men. The role of financial literacy and digital skills," Small Business Economics, Springer, vol. 55(2), pages 313-327, August.
    9. Alessandro Bucciol & Martina Manfre' & Marcella Veronesi, 2018. "The Role of Financial Literacy and Money Education on Wealth Decisions," Working Papers 05/2018, University of Verona, Department of Economics.
    10. Lin, Chaonan & Hsiao, Yu-Jen & Yeh, Cheng-Yung, 2017. "Financial literacy, financial advisors, and information sources on demand for life insurance," Pacific-Basin Finance Journal, Elsevier, vol. 43(C), pages 218-237.
    11. M. Debbich, 2015. "Why Financial Advice Cannot Substitute for Financial Literacy?," Working papers 534, Banque de France.
    12. Kadoya, Yoshihiko & Khan, Mostafa Saidur Rahim, 2020. "What determines financial literacy in Japan?," Journal of Pension Economics and Finance, Cambridge University Press, vol. 19(3), pages 353-371, July.
    13. Zaheer Ahmed & Umara Noreen & Suresh A.L. Ramakrishnan & Dewi Fariha Binti Abdullah, 2021. "What explains the investment decision-making behaviour? The role of financial literacy and financial risk tolerance," Afro-Asian Journal of Finance and Accounting, Inderscience Enterprises Ltd, vol. 11(1), pages 1-19.
    14. Tim Kaiser & Annamaria Lusardi, 2024. "Financial Literacy and Financial Education: An Overview," NBER Working Papers 32355, National Bureau of Economic Research, Inc.
    15. French, Declan & McKillop, Donal, 2016. "Financial literacy and over-indebtedness in low-income households," International Review of Financial Analysis, Elsevier, vol. 48(C), pages 1-11.
    16. Maarten C.J. van Rooij & Annamaria Lusardi & Rob J.M. Alessie, 2012. "Financial Literacy, Retirement Planning and Household Wealth," Economic Journal, Royal Economic Society, vol. 122(560), pages 449-478, May.
    17. Klapper, Leora & Lusardi, Annamaria & Panos, Georgios A., 2013. "Financial literacy and its consequences: Evidence from Russia during the financial crisis," Journal of Banking & Finance, Elsevier, vol. 37(10), pages 3904-3923.
    18. Feng, Xiangnan & Lu, Bin & Song, Xinyuan & Ma, Shuang, 2019. "Financial literacy and household finances: A Bayesian two-part latent variable modeling approach," Journal of Empirical Finance, Elsevier, vol. 51(C), pages 119-137.
    19. Iwa Kuchciak & Justyna Wiktorowicz, 2021. "Empowering Financial Education by Banks—Social Media as a Modern Channel," JRFM, MDPI, vol. 14(3), pages 1-22, March.
    20. Annamaria Lusardi & Olivia S. Mitchell, 2014. "The Economic Importance of Financial Literacy: Theory and Evidence," Journal of Economic Literature, American Economic Association, vol. 52(1), pages 5-44, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:jouent:v:31:y:2022:i:1:p:153-183. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.ediindia.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.