Title: The effect of entrepreneurs' motivation and the local economic environment on young venture performance

Authors: Alberto Arias, Inaki Pena

Addresses: Facultad de Ciencias Economicas y Administrativas, Pontificia Universidad Javeriana Cali, Calle 18 N 118-250, Cali, Colombia. ' Basque Institute of Competitiveness, University of Deusto, Mundaiz 50, Donostia 20.012, Spain

Abstract: In this study, we examine the effect of entrepreneurs| motivation and the local economic environment on young venture performance. Field data was collected from entrepreneurs of two different regions, South America and Europe. Our findings suggest that the degree of entrepreneurial motivation at firm creation (i.e., necessity-driven versus opportunity-driven motivation) determine subsequent venture performance during firm infancy (i.e., three to four initial years from inception). Results show that the human capital profile of necessity-driven entrepreneurs at the moment of firm start-up is weaker than that of opportunity-driven entrepreneurs in both regions. When we compare the profile of necessity-driven entrepreneurs for each region, noticeable differences arise.

Keywords: necessity-driven entrepreneurs; opportunity-driven entrepreneurs; entrepreneur motivation; young ventures; firm performance; South America; Europe; entrepreneurship; firm creation.

DOI: 10.1504/IJBE.2010.031269

International Journal of Business Environment, 2010 Vol.3 No.1, pp.38 - 56

Published online: 27 Jan 2010 *

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