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Is Entrepreneurial Success Predictable? An Ex‐Ante Analysis of the Character‐Based Approach
Author(s) -
Caliendo Marco,
Kritikos Alexander S.
Publication year - 2008
Publication title -
kyklos
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 58
eISSN - 1467-6435
pISSN - 0023-5962
DOI - 10.1111/j.1467-6435.2008.00398.x
Subject(s) - predictive power , character (mathematics) , psychology , personality , power (physics) , ex ante , set (abstract data type) , social psychology , capital (architecture) , human capital , applied psychology , econometrics , marketing , business , economics , computer science , mathematics , history , philosophy , physics , geometry , archaeology , epistemology , quantum mechanics , macroeconomics , programming language , economic growth
SUMMARY This paper empirically analyzes whether the character‐based approach, which focuses on the personality structure and the human capital of business founders, allows prediction of entrepreneurial success. A unique data set is used consisting of 414 persons whose personal characteristics were analyzed by different methods, namely an one‐day assessment center (AC) and a standardized questionnaire, before they launched their business. Results are partly unexpected and weaker than previous ex‐post findings: first, we found correlations between the AC data and the questionnaire in one subgroup only. Second, the predictive power of the AC data is slightly better than that of the questionnaire, but lower than expected in theory. Interestingly, for those subgroups where the AC data have low predictive power, the questionnaire does better. Third, when success is measured in terms of employees hired, the character‐based approach is a poor predictor.