The preferences and traits that make entrepreneurship unprofitable, usually encourage entrepreneurial entry decisions. We investigate this proposition, where the taste parameter is impatience. Impatient employees search less intensively for entrepreneurial opportunities. However, once a prospect is found, the impatient will be more willing to accept the opportunity than to wait for better opportunities to present themselves. The effect of impatience on entrepreneurial entry is therefore ambiguous. What is less ambiguous is the effect of impatience on entrepreneurial performance. Search intensity and the eagerness to act upon entrepreneurial opportunities, as well as associated issues surrounding under-investment and planning intensity, suggest the effect of impatience on entrepreneurial earnings is unambiguously negative. Using a large UK longitudinal survey, we find that impatience decreases entry into entrepreneurship. Controlling for earnings in paid-employment, we also find that impatience decreases entrepreneurial earnings. Taken together these results suggest that for entrepreneurship “patience is a virtue”.
|Number of pages||37|
|Publication status||Published - 1 Jul 2022|
- Impatience, Entrepreneurship, Time Preferences, Exponential Discounting, Hyperbolic Discounting