Self-efficacy and entrepreneurial performance of start-ups

Abstract

Self-efficacy reflects the self-belief that one can persistently perform difficult and novel tasks while coping with adversity. As such beliefs reflect how individuals behave, think, and act, they are key for successful entrepreneurial activities. While existing literature mainly analyzes the influence of the task-related construct of entrepreneurial self-efficacy, we take a different perspective and investigate, based on a representative sample of 1,405 German business founders, how the personality characteristic of generalized self-efficacy influences start-up performance as measured by a broad set of business outcomes up to 19 months after business creation. Outcomes include start-up survival and entrepreneurial income, as well as growth-oriented outcomes such as job creation and innovation. We find statistically significant and economically important positive effects of high scores of self-efficacy on start-up survival and entrepreneurial income, which become even stronger when focusing on the growth-oriented outcome of innovation. Furthermore, we observe that generalized self-efficacy is similarly distributed between female and male business founders, with effects being partly stronger for female entrepreneurs. Our findings are important for policy instruments that are meant to support firm growth by facilitating the design of more target-oriented offers for training, coaching, and entrepreneurial incubators.

Social Inclusion: A Factor That Influences the Sustainable Entrepreneurial Behavior of Generation Z

“…Our findings are in agreement with the results of Wennberg et al (2013), who observed that self-efficacy differs between females and males but are in contradiction with those of Caliendo et al (2023), who concluded that self-efficacy is equally distributed between female and male entrepreneurs. Newman et al (2019) believe that the difference between males and females related to self-efficacy is caused by the fact that women have less entrepreneurial experience than men.…”

Personality and public sector employment in Finland

“…Previous studies have demonstrated that individuals with high self-confidence are more inclined to make riskier choices in the labor market. Specifically, self-confidence or its domains have been linked to entrepreneurship (Caliendo et al, 2023;Newman et al, 2019), a field often associated with substantial risks that are typically poorly diversified (Vereshchagina & Hopenhayn, 2009). 4 Therefore, the finding that selfconfidence is positively related to public sector employment is in line with the well-established finding that risk-averse individuals are more likely to be sorted into the public sector (Buurman et al, 2012;Dohmen & Falk, 2010;Lewis & Frank, 2002;Pfeifer, 2011).…”

Cognitions affecting innovation among generation Z entrepreneurs: the external enablement of digital infrastructure

“…Reflecting individuals' self-belief in their knowledge and capabilities (Newman et al, 2019), ESE significantly influences their perception of how they accomplish their goals . Self-efficacious individuals with higher levels of goal commitment (McGee & Terry, 2022), passion for business development (Cardon & Kirk, 2015), setting higher expectations (Wei et al, 2020), and underestimating difficulties would be able to undertake novel task (Caliendo et al, 2023b) and thereby might be more prone to be innovative (Caliendo et al, 2023b;Nag et al, 2020;Wei et al, 2020). Opportunity identification capabilities equip entrepreneurs with imagination and creativity on the one hand (Gaglio & Katz, 2001) and identifying market gaps (Vedula et al, 2019) on the other hand, through which they would be able to devise new possibilities as the forms of new products/services or new ways of doing things (Dyer et al, 2008;Gaglio, 2018;Park, 2005).…”