Personality traits and entrepreneurial intention: The mediating role of risk aversion

• Published date: 01 February 2022
• Author: Malik Aftab Ahmed,Muhammad Sualeh Khattak,Muhammad Anwar
• Date: 01 February 2022
• DOI: http://doi.org/10.1002/pa.2275

ACADEMIC PAPER

Personality traits and entrepreneurial intention: The mediating

role of risk aversion

Malik Aftab Ahmed

1

| Muhammad Sualeh Khattak

2

| Muhammad Anwar

3

1

Faculty of Management Sciences,

International Islamic University, Islamabad,

Pakistan

2

Hamdard Institute of Management Sciences,

Islamabad, Pakistan

3

Witten Institute for Family Business (WIFU),

Witten/Herdecke University, Witten, Germany

Correspondence

Muhammad Anwar, Witten Institute for Family

Business, Witten/Herdecke University,

Witten, Germany.

Email: m.anwar.ims@gmail.com

The aim of this paper is to investigate the influence of big five personality traits on

entrepreneurial intentions with the mediating role of risk aversion. A structured ques-

tionnaire was used and collected data from 274 Pakistani students (university level).

The hypotheses were tested through structural equation modeling by using AMOS.

The findings display that the personality trait “conscientiousness”has a significant

positive influence on entrepreneurial intentions while the traits, extroversion, open-

ness to experience neuroticism, and agreeableness are not significantly influenced

entrepreneurial intentions directly. Neuroticism, conscientiousness, and openness

have a significant relationship with risk aversion while extroversion and agreeable-

ness do not significantly influence risk aversion. There is a significant association

between risk aversion and entrepreneurial intention. Risk aversion fully mediates the

relationship of neuroticism and openness to experience with entrepreneurial inten-

tion while it partially mediates the path between consciousness and entrepreneurial

intention. However, we found that risk aversion does not mediate the relationship

between extroversion and agreeableness with entrepreneurial intention. The study

suggests investors and policymakers to understand the behavior of students who are

prominent future entrepreneurs and promote new start-ups among students by pro-

viding various incentives (financial and nonfinancial). Other implications are stated.

1|INTRODUCTION

The successof entrepreneurship in the currentedge has led global mar-

kets' interest into the development of entrepreneurial activities and

startups, in the desire that this will leashto an increase in GDP growth,

economic maturation, growth, poverty alleviation, and propensity of a

country (Singeret al., 2014). The fathering of new ventureshas become

a piston for economic development in emerging economies (Fayolle,

Landstrom,Gartner, & Berglund, 2016).However, a new venture forma-

tion is not as easy as we think of rather it requires enough resources

(e.g., tangibleand intangible) and support(Huang, 2016). Despite having

enough programs and support of the government and responsible

authorities for encouraging new ventures, still many individuals are not

able to pioneertheir ventures (Soetanto,Huang, & Jack, 2018). A bunch

of studies hasdiscussed traditional factorssuch as financial capital,sup-

port, resources, technology and innovation ideas (Bruton, Khavul,

Siegel, & Wright,2015; Marvel, Davis,& Sproul, 2016; Nambisan, 2017;

Schmitz, Urbano, Dandolini, de Souza, & Guerrero, 2017), and psycho-

logical factors such as personality, behaviors, self-efficacy, and so on

(Hamilton, Papageorge, & Pande, 2019; Kirkley, 2017; Sultana, Im, &

Im, 2019) that can influence new venture creation; however, there is

still need of systemization and ordering for deep conceptualization of

intent generation process because there is risk of lack of robustness

[Correction added on 19th Sep 2020, after first online publication: Projekt Deal funding

statement has been added.]

Received: 17 February 2020 Revised: 25 March 2020 Accepted: 8 July 2020

DOI: 10.1002/pa.2275

This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits use and distribution in any

medium, provided the original work is properly cited, the use is non-commercial and no modifications or adaptations are made.

© 2020 The Authors. Journal of Public Affairs published by John Wiley & Sons Ltd.

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https://doi.org/10.1002/pa.2275