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Can Culture Account for Investment Expectations?

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  • Michael Lainé

    (Laboratoire d’Économie Dionysien-LED, EA 3391, Université Paris 8 Vincennes - Saint-Denis, Saint-Denis, France - LED)

Abstract

Until recently, risk-taking in investment decisions has been explained by cognitive biases and emotional urges. I would like to propose an alternative explanation, based on the work of Pierre Bourdieu, who links cultural capital to risk-taking. His concept of cultural capital has a very broad meaning, as it encompasses technical skills, aesthetic preferences, verbal facility, general cultural awareness, educational credentials, and artistic competencies. On theoretical grounds, one can assume that a high level of cultural capital enables the taming of uncertainty and allows for temporal horizons that cover longer terms. I test this hypothesis by conducting and analyzing a survey of 307 entrepreneurs. I define risktaking in two ways: (i) in a somewhat mainstream way, on the basis of expected utility, and (ii) in a heterodox way, in a qualitative, context-dependent setting. I find that, in both cases, there seems to be a link between cultural capital and risktaking. Furthermore, it seems to make financing issues more salient. I conclude by opening a discussion about the heterogeneity of entrepreneurs and their animal spirits.

Suggested Citation

  • Michael Lainé, 2016. "Can Culture Account for Investment Expectations?," Post-Print hal-04265074, HAL.
    • Handle: RePEc:hal:journl:hal-04265074
    DOI: 10.1080/00213624.2016.1147895
    Note: View the original document on HAL open archive server: https://hal.science/hal-04265074
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    References listed on IDEAS

    as
    1. Anne Mayhew, 1987. "Culture: Core Concept under Attack," Journal of Economic Issues, Taylor & Francis Journals, vol. 21(2), pages 586-603, June.
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    5. Hoyt Alverson, 1986. "Culture and Economy: Games That “Play People”," Journal of Economic Issues, Taylor & Francis Journals, vol. 20(3), pages 661-679, September.
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    7. Gregory F. Hayden, 1988. "Values, Beliefs, and Attitudes in a Sociotechnical Setting," Journal of Economic Issues, Taylor & Francis Journals, vol. 22(2), pages 415-426, June.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Bourdieu cultural capital entrepreneur investment expectations risktaking JEL Classification Codes: D21 D22 D81; Bourdieu; cultural capital; entrepreneur; investment expectations; risktaking JEL Classification Codes: D21; D22; D81;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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