Entrepreneurship Theories Essay

1. Introduction

2. Definitions of Entrepreneur and Entrepreneurship Before analyzing the four entrepreneurship theories it is important to fully understand who is an entrepreneur and therefore what an entrepreneurship is. A research on the definition of entrepreneurs shows that there is no universally accepted definition of an entrepreneur (Smith-Hunter, Kapp, & Yonkeres, 2003). The definition used will usually depend on the purpose of the paper being written. For the purpose of this paper we will use the following definitions: Dictionary.com defines entrepreneur as “a person who organizes and manages any enterprise, especially a business, usually with considerable initiative and risk”. Also found is the definition given by the Merriam-Webster

It is understood that the level of analysis in psychological theories is the individual and they emphasize personal characteristics that define entrepreneurship (Nkansah, 2011). There are two types of researchers in the field of entrepreneurial psychology. There’s the more traditional group which focus on the personality characteristics and then there’s a second group that take a social cognitive approach, looking at the relationship between an individual and his or her environment. Three theories that stem from the traditional group are: Personality Traits theory, Locus of Control and Need for Achievement

It is the individual’s interaction and reaction to these external factors that will distinguish an individual as entrepreneur. The first factor, work experience, can influence an individual to become an entrepreneur in the following two ways: dissatisfaction with a previous work experience can push you into wanting to become your own boss and the work experience itself, most of the time, helps to develop the entrepreneur in his/her area of expertise. The second factor which is support and role models proposes that an individual learns from observing other, referred to as role