Entrepreneurship Motives

What motivates a person to become an entrepreneur?

Motives are combinations of goals, self-efficacy, and vision (Baum et al., 2001). Generally, motivations are both extrinsic and intrinsic; money, status, recognition, and social acceptance are extrinsic rewards (Ellerman, 2009). While achievement, knowledge, skill, autonomy, self-respect, and solutions to problems are examples of intrinsic rewards (McGregor, 1966). About seventy years ago Schumpeter expresses the following regarding entrepreneurial motives:

"First of all, there is the dream and the will to found a private kingdom, usually, though not necessarily, also a dynasty. … Then there is the will to conquer, the impulse to fight, to prove oneself superior to others, to succeed for the sake, not of the fruits of success, but of success itself. From this aspect economic action becomes akin to sport-… The financial result is a secondary consideration, or, at all events, mainly valued as an index of success and as a symptom of victory, the displaying of which very often is more important as a motive of large expenditure than the wish for the consumers’ goods themselves. … Finally, there is the joy of creating, of getting things done, or simply of exercising one’s energy and ingenuity.... Our type seeks out difficulties, changes in order to change, delights in ventures" (Schumpeter, 1934, p. 93-94).

Furthermore, Carter et al. (2003, p. 14) specify six career motives:

1) Innovation- New accomplishment intentions and creativity

2) Independence- Freedom, control and flexibility of one’s' time

3) Recognition- Status or approval from family, friends and society

4) Role- Family tradition or emulate example of others.

5) Financial success- Increase earnings or financial independence.

6) Self-realisation- Pursuing personal goals

Given the above do you recognise what motivates your career or the entrepreneurs career, and is this worth being studied? Carsrud and Brannback (2011, p. 11) argue over the past two decades entrepreneurial motivation studies are being ignored like traits research since motives appear similar between entrepreneurs and non-entrepreneurs, which is unfortunate because motivation research explicates the intention-action link and answers questions regarding:-

(a) What activates a person?

(b) What makes the individual choose a behaviour over another? and

(c) Why people respond differently to the same motivational stimuli?

Furthermore, the normative theory of decision-making drawn from the concept of expected utility (EU) maximisation (Hardman and Connolly, 2009) state individuals are motivated by utility anticipated from pursuing entrepreneurship (Douglas and Shepherd, 2000). Thus, additional to the motives above from Carter et al. (2003), the quest for the identity motivates entrepreneurial behaviour (Akerlof and Kranton, 2000). When faced with opportunity, individuals perceive and decide through a rational process that clarifies going ahead against abandoning the opportunity; those who become entrepreneurs their subjective return to entrepreneurship is positive (Minniti and Bygrave, 1999, p. 41). Their self-employed decision outweighs being employed which is often a rational process of expected utility (Campbell, 1992; Douglas and Shepherd, 2000, 2002).

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