Entrepreneurship Born, Made and Educated Edited by Thierry Burger-Helmchen ENTREPRENEURSHIP – BORN, MADE AND EDUCATED Edited by Thierry Burger-Helmchen INTECHOPEN.COM Entrepreneurship - Born, Made and Educated http://dx.doi.org/10.5772/2649 Edited by Thierry Burger-Helmchen Contributors Ricardo Gouveia Rodrigues, Anabela Dinis, Arminda Paço, João Ferreira, Mário Raposo, Isabel Neira, Sara Fernandez, David Rodeiro, Milagros Vivel, María Jesús Rodríguez, John Bratland, Jose C. Sanchez, Vegard Johansen, Tuva Schanke, Tommy Høyvarde Clausen, Maribel N. Mojica-Howell, Wesley Whittaker, Tesfa Gebremedhin, Peter Schaeffer, Panagiotis Petrakis, Nor Aishah Buang, Ishfaq Ahmed, Alenka Slavec, Rory O’Shea, Philip Bowe, Alan E. Singer, Melek Kalkan, Canani Kaygusuz, Pasi Juvonen, Muhammad Nizam Zainuddin, Marta Portela - Maseda, Emilia Vazquez-Rozas, Elvira Vieira © The Editor(s) and the Author(s) 2012 The moral rights of the and the author(s) have been asserted. 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For more information visit www.intechopen.com 4,000+ Open access books available 151 Countries delivered to 12.2% Contributors from top 500 universities Our authors are among the Top 1% most cited scientists 116,000+ International authors and editors 120M+ Downloads We are IntechOpen, the world’s leading publisher of Open Access books Built by scientists, for scientists Meet the editor Thierry Burger-Helmchen is a professor in Man- agement Science at EM Strasbourg, University of Strasbourg, Alsace, France. He is a researcher at BETA-CNRS and his research topics are entrepreneur- ship and innovation management. He teaches Strategy of SMEs and Entrepreneurship in the M3E program (Management and Entrepreneurship in the European Environment), a multi-country entrepreneurship program of IUT Louis Pasteur, University of Strasbourg. Contents Preface XI 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 59 Alan E. Singer Part 2 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 X 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 Ventures 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) XII 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 Where Education, development and institutional context Why Managerial context How Description of the entrepreneur, object of the study: The entrepreneur is an important element of macro and local development. The impact can depend on gender, geographical location and social context. Is one a born entrepreneur? Does one become an entrepreneur through a specific education system or a special institutional context? The entrepreneurial process, the detection of opportunities, the development of ideas, creativity, and innovation. The construction of new business models Sectors of interest: Political level (country, region, town level) Educational system, historical studies, political influence Economists involved in theory of the firm, management science Preface X II I 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 , March- April, pp. 85-94. Timmons, J.A. 1989. The Entrepreneurial Mind. Brick House Pub. XI V 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 May s 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 Entrepreneurship – Born, Made and Educated 4 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 The Psychology of Entrepreneurship 5 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