Predicting entrepreneurial behaviour: a test of the theory of planned behaviour

TLDR: In this paper, the authors apply the Theory of Planned Behaviour (TPB) to predict entrepreneurial behavior and find that attitude, perceived behavioural control and subjective norms are significant predictors of entrepreneuria.

Abstract: This article contributes to the occupational choice literature pertaining to entrepreneurship by applying the Theory of Planned Behaviour (TPB) to predict entrepreneurial behaviour. Originating from social psychology, the TPB posits that intention, a function of behavioural beliefs, is a significant predictor of subsequent behaviour. In spite of an established stream of scholarship explaining the formation of entrepreneurial intentions, empirical research has not yet employed longitudinal data to examine whether the intention to start a business measured at one point of time translates into subsequent entrepreneurial behaviour. This article provides a full test of the TPB in the prediction of business start-up intentions and subsequent behaviour based on two-wave survey data (2006 and 2009) from the working-age population in Finland. The econometric results support the predictions outlined in the TPB: attitude, perceived behavioural control and subjective norms are significant predictors of entrepreneuria...

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Predicting entrepreneurial behaviour: a test of the
theory of planned behaviour
Teemu Kautonen, Marco van Gelderen, Erno T. Tornikoski
To cite this version:
Teemu Kautonen, Marco van Gelderen, Erno T. Tornikoski. Predicting entrepreneurial behaviour: a
test of the theory of planned behaviour. Applied Economics, Taylor & Francis (Routledge), 2011, 45
(06), pp.697-707. �10.1080/00036846.2011.610750�. �hal-00741505�

For Peer Review
Predicting entrepreneurial behaviour: a test of the theory of
planned behaviour
Journal:
Applied Economics
Manuscript ID:
APE-2010-0110.R1
Journal Selection:
Applied Economics
Date Submitted by the
Author:
11-Mar-2011
Complete List of Authors:
Kautonen, Teemu; University of Turku, TSE Entre
van Gelderen, Marco; Massey University
Tornikoski, Erno; ESC Saint-Etienne
JEL Code:
J23 - Employment Determination; Job Creation; Labor Demand;
Self-Employment < J2 - Time Allocation, Work Behavior, and
Employment Determination/Creation < J - Labor and Demographic
Economics, J24 - Human Capital|Skills|Occupational Choice|Labor
Productivity < J2 - Time Allocation, Work Behavior, and
Employment Determination/Creation < J - Labor and Demographic
Economics, M13 - Entrepreneurship < M1 - Business Administration
< M - Business Administration and Business Econ; Marketing;
Accounting
Keywords:
occupational choice, self-employment, entrepreneurship, intention,
Theory of Planned Behaviour
Editorial Office, Dept of Economics, Warwick University, Coventry CV4 7AL, UK
Submitted Manuscript

For Peer Review
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For Peer Review
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Predicting entrepreneurial behaviour: a test of the theory of planned
behaviour
I. Introduction
The extant literature often models participation in entrepreneurship as a utility-
maximizing occupational choice between self-employment and paid employment
(e.g., Blanchflower et al., 2001; Moore and Mueller, 2002; Rojas and Siga, 2009;
Uusitalo, 2001; for an overview, see chapter 2 in Parker, 2009). A recent article in
this journal extends this model by analysing the occupational choice of self-
employment as an ordinal variable comprising several stages, thus accounting for the
process nature of new venture creation (van der Zwan et al., 2010). The econometric
models in van der Zwan et al. (2010) employ a range of demographic determinants
and individual perceptions related to the economic environment. The present article
extends this research by introducing psychological constructs to explain an
individual’s progress across different entrepreneurial engagement levels
(entrepreneurial behaviour) by applying Ajzen’s (1991) Theory of Planned
Behaviour (TPB). Originating from social psychology, the TPB works on the
assumption that intention is a significant predictor of behaviour, while intention itself
is a function of behavioural beliefs that link the given behaviour to certain outcomes.
In the entrepreneurial context, the TPB thus contributes to our understanding of the
emergence of entrepreneurial behaviour prior to the onset of any observable action,
which has notable implications for policy, for example if the objective is to promote
enterprising activity by fostering a culture conducive to entrepreneurship (Kautonen
et al., 2009; Liñán and Chen, 2009).
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A great deal of cross-disciplinary research has been devoted to testing,
advancing and criticizing the TPB (for overviews in social psychology, see the meta-
analyses by Armitage and Conner, 2001 and Sheeran, 2002; for applications of the
TPB to analyse diverse economic behaviours, see for example d’Astous et al., 2005;
East, 1993; Lynne et al., 1995). In the entrepreneurial context, many studies have
applied the TPB to predict the intention to start a business, albeit often using
convenience samples of university students (e.g., Autio et al., 2001; Kolvereid, 1996;
Krueger et al., 2000; van Gelderen et al., 2008). This body of literature also argues
that the TPB provides more predictive power in this context than personality traits or
demographic characteristics (Autio et al., 2001; Krueger et al., 2000), which are
common in the occupational choice literature pertaining to entrepreneurship (see
Parker, 2009 for an overview). As Krueger and his colleagues (2000: 413) put it,
scholars best predict any planned behaviour, such as entrepreneurship, ‘by observing
intentions toward that behaviour–not by attitudes, beliefs, personality, or mere
demographics’. The intention construct and its antecedents are ‘closer to the action’
than more distal constructs such as traits and demographics, which may predict broad
classes of behaviour well, but not specific actions (Epstein and O’Brien, 1985; Rauch
and Frese, 2007), and whose effects the more immediate, proximal TPB constructs
mediate (Ajzen, 1991; 2011). In other words, distal constructs such as traits and
demographics are antecedents of the more proximal constructs in the TPB model,
where intention is the immediate predictor of behaviour.
In spite of the established stream of scholarship explaining the formation of
entrepreneurial intentions, the authors of the present article are not aware of a single
empirical study that would use longitudinal data to examine whether the intention to
start a business measured at one point of time translates into subsequent
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Frequently asked questions

Q1. What are the contributions mentioned in the paper "Predicting entrepreneurial behaviour: a test of the theory of planned behaviour" ?

Kautonen et al. this paper used the theory of planned behavior to predict entrepreneurial behavior in a sample of 117 working-age individuals from Western Finland. 

Q2. What are the future works mentioned in the paper "Predicting entrepreneurial behaviour: a test of the theory of planned behaviour" ?

Hence, future studies should seek to obtain larger, preferably cross-cultural samples to validate the preliminary findings presented in this article. Moreover, future research should distinguish between different types of entrepreneurship, such as full-time and parttime entrepreneurship, sole proprietorships and businesses with employees, lifestyle businesses and those with growth aspirations, opportunity and necessity-driven entrepreneurship, or for-profit and social enterprises. These distinctions are of considerable relevance to policy, for example, in terms of assessing the social and economic potential of latent entrepreneurship in different segments of the population, and in targeting and designing enterprise support initiatives. In spite of the limitations, this article demonstrates the potential of the TPB in studying the emergence of complex economic behaviour such as entrepreneurship prior to the onset of any observable action. 

Q3. What is the common method used in SEM?

The analysis uses the MPlus Version 6 software package, which canaccommodate probit regressions into structural equation models with the WLSMV estimator (Muthén and Muthén, 1998-2010; Xie, 1999), thus enabling the modelling of ordinal response variables (intention and behaviour) in the SEM framework. 

Q4. What is the meaning of intention in the TPB framework?

In the TPB framework, intention is a function of three antecedents: a favourable or unfavourable evaluation of the behaviour (attitude), perceived social pressure to perform or not perform the behaviour (subjective norm), and the perceived ease or difficulty of performing the behaviour (Perceived Behavioural Control, PBC) (Ajzen, 1991). 

Q5. What is the meaning of intention in the entrepreneurship literature?

Applied to the entrepreneurial context, the more positive an individual’s evaluations of engaging in entrepreneurial behaviour are, the more supportive of entrepreneurial behaviour the individual perceives their significant others to be, and the more capable they feel of performing entrepreneurial activities, the stronger should be their intention, ceteris paribus, to engage in entrepreneurial behaviour. 

Q6. How does Ajzen cite the fact that the entrepreneur is not fully under his or?

Since entrepreneurial behaviour is not totally under the individual’s volitional control – for example, dealing with regulations, obtaining financing and acquiring customers introduce contingencies to the process of new venture creation that are beyond the aspiring entrepreneur’s complete control – PBC is likely to contribute to the prediction of behaviour over and above its mediated influence via intention. 

Q7. What is the primary dependent variable in the study?

The primary dependent variable in this study, entrepreneurial behaviour, captures whether and how the respondent had engaged in entrepreneurial behaviour by the time of the second survey wave in November 2009. 

Q8. What is the way to estimate a structural model?

The estimated model shows good fit with the data: the chi-square test of model fit is non-significant; the comparative fit index (CFI) exceeds the recommend minimum value of 0.95; the root-mean-square error (RMSEA) score is below the recommended maximum value of 0.06; and the weighted root-mean-square residual (WRMR) is less than the recommended maximum value of 0.90 for models with categorical dependent variables (Hu and Bentler, 1999; Yu and Muthén, 2002). 

Q9. What was the first-wave survey on entrepreneurial behaviour?

The second-wave survey collected data on entrepreneurial behaviour, andincluded those first-wave respondents who were not self-employed in 2006 and who had given their permission and contact details for a follow-up study (29% of those not self-employed in 2006). 

Q10. How many respondents were female in the first wave of the survey?

women have a higher comparative participation rate than men, since 58% of the respondents in the sample are female compared with 49 % in the original list. 

Q11. What is the definition of intention in the entrepreneurship literature?

In the entrepreneurial context, Thompson (2009, p. 676) defines intention as ‘a self-acknowledged conviction by a person that they intend to set up a new business venture and consciously plan to do so at some point in the future’. 

Q12. What limitations affect the generalizability of the results?

The firstlimitation is the small number of respondents who participated in both waves of the survey (N=117), while the second limitation refers to the geographic scope of the sample being limited to three Finnish provinces.