Entrepreneurship : Entrepreneurial Motivation Answers Assessment Answer



Entrepreneurial motivation plays a significant role in psychological throughout the process of entrepreneurship. According to Barba-Sánchez and Atienza-Sahuquillo (2012), entrepreneurs cannot overcome the difficulties and pressures and continue to bear a series of the “uncertainty” without motivation. Baum, Frese and Baron (2014) stated that “Motivation is a very broad and very complex psychological phenomenon which stimulate and sustain activities of individuals and to lead the activities towards a certain goal as these psychological phenomena is the basis of the constitutions of most of human behavior”. Current research on entrepreneurship has focused largely on “macro-level environmental forces”. Although entrepreneurship largely depends on the decisions that individuals make about how to undertake the decisions and how such decisions are influenced by the economic and cultural environment. 

Research Informed Literature:

Employee motivation is one of the key drivers of the success of the entrepreneur (Adamu, Kedah and Osman-Gani 2013). The active participation of newly created enterprises in dynamic economies has attracted considerable interest among academicians (Solesvik 2013). However, its contribution towards the growth of the economy is not said to be easy and entrepreneurs meets a lot of resistance on their journey (Webb et al. 2013). There are several variables are identified which can be considered common features of entrepreneurship including independent desire, high tendency to risk, broader need for achievement, locus towards the organizational control, and exploring broader chance for innovation. In the generalized idea, traits and characteristics has played a furthermost relevance to start-up decision-making in the context of the entrepreneurial personality (Byrne and Shepherd 2015).  The consideration of start-up decision is thus such as the product of motives and intensions that vary according to individualists traits and abilities of entrepreneurship. While taking decision for the success of the start-up venture, social and psychological influences are playing large role. It is always important to recognize the social cognition as thing about people. By utilizing the certain interpersonal traits such as risk taking ability, flexibility, energy and motivation, the entrepreneur can be able to design an organization and establish a social surroundings to perform comprehensively (Frese and Gielnik 2014). However, “the narrow set of characteristics possessed by the small group often makes the average person’s stereotypes of an entrepreneur” (Garud and Giuliani 2013). On the contrary, Douglas and Fitzsimmons (2013) defined business is essential for the progress of the nation. Contribution towards the wellbeing of the society in several ways  to improve living conditions of the people, the new startups and ongoing ventures often involved in sponsorship, welfare programs to provide the less privileged with benefits to improve their living conditions. The social entrepreneurship is another perspective of the environmental motivation which has increasingly become an important aspect for the development of economy because it creates economic and social values in the following areas:

Employment development: By largely influenced by the economic and cultural environment, an entrepreneurial motivation is significantly contributes in job and employment creation (Garud, Gehman and Giuliani 2014).  Social enterprises offer opportunities for employment and job training to segments of society at any employment disadvantage (Minola, Criaco and Obschonka 2016).

Innovation/New goods or services: By developing new products and services, the entrepreneurs largely contribute in social and economic developments. For instance, the Brazilian social entrepreneur Veronica Khosa has a face renowned face that developed a home-based care model for AIDS patients. The nation has changed the government healthy policy later.

Social capital: “Entrepreneurial thought defines knowledge-structure of people who use judgments, evaluations and decisions which include using opportunities, risk taking and growth” (Byrne and Shepherd 2015). By this approach they are largely contributed in the creation of social capital. The “World Bank” also sees social capital as critical for poverty alleviation and sustainable human and economic development.

Equity promotion: The entrepreneurial motivation largely encourages for addressing social issues and to achieve ongoing sustainable impact through their social mission rather than purely profit-maximization (Audretsch, Kuratko and Link 2015). Therefore, the cultural motivation significantly influenced to contribute as change agents providing leading edge-innovation to unaccomplished social and economic needs.

Knowledge and Understanding of the perspective of Entrepreneurial motivation and its contribution:

Motivation is the internal psychological process of “initiating”, “energizing”, “directing” and maintaining “goal-oriented behavior”. According to Baum, Frese and Baron (2014), “motivation is identified the psychological or psychological deficiency or need that activates behavior or drive that is aimed at a goal or incentive.” By giving efforts towards the organizational goals, the organization extended their social and economic contribution under effective entrepreneurs within the enterprise. There were several motivational researchers explored previously and discussed its effect or contributions on entrepreneurship. However, most of the definitions are found as inconsistent which make it difficult to draw directly implications of prior work for research using such definition. Earlier researches have correctly disapproved of an ample of the present experimental research on the function of human motivation in entrepreneurship (Sánchez and Sahuquillo 2012). Hayton and Cacciotti (2013) indicated that activities of entrepreneurial “can be conceptualized as a function of opportunity, structures and motivated entrepreneurs with access to resources”. On the contrary, the researchers indentified numinous human motivations that largely influenced the process of the entrepreneurial factors.  This entrepreneurial factors is the result of both motivational as well as the cognitive factors which includes ability skills and intelligence.

Unfortunately, a clear connection between entrepreneurship and cognition is still not established because all such researches have newly explored. By the process of cognitive studies, the entrepreneurs can understand the “how to achieve sustainable learning in order to see opportunities”. This upgrades the entrepreneurial thinking and helps personality to shape through and within the culture. In several researches this has been discovered that culture is one of the factors that determine entrepreneurship; and this result created a lot of interest towards the relationship between the cognitive process and entrepreneurship. Previously, majority of researchers considered culture of the entrepreneurship and the personality as the core factors that affect entrepreneurship. In the recent times, however, the researchers have recognized the cognitive research theories in order to discuss the entrepreneurial thinking. Under the cognitive perspective, “there are several factors are evaluated such as high level of uncertainty, pressure of time and exhaustion affect human cognition continuously and make people take new and sharp decisions all the time, strong emotions in the face of incidents and so on” (Solesvik 2013).

Therefore, this can be concluded that the cognitive process of entrepreneurial thinking has changed the complete perspectives of the corporate entrepreneurship by the characteristics of three functions such as development of new business units by established firm, development and implement of entrepreneurial strategies and emergence of new ideas from various levels in the organization. By these practices it is important to remember the cultural considerations while authorizing duties such as open communication, seek innovation, tolerance of failure accepts mistakes and  so on. 


Entrepreneurial motivation and entrepreneurial intentions are indeed different on the psychological front; however several researchers identified those as an entrepreneurial aspiration, idea and driving force (Hayton and Cacciotti  2013).  As for environment factors, they include overall condition of political, economic, and cultural factors and the surroundings and supporting degree of entrepreneurship from the government, all of these factors could influence entrepreneurial motivation.  To discuss the current perspective of entrepreneurial motivation, it is important to identify the process of entrepreneurship for various reasons. According to Stenholm, Acs and Wuebker (2013), entrepreneurship drives innovation and the changes of technicalities, which are largely responsible in generation of economic growth. On the other hand, entrepreneurship is significant process by which new knowledge people can comprehend its role in the human development and intellectual capital. The article depicts that entrepreneurship involves human agency. This process occurs because people act to pursue opportunities. There is an individual willingness and abilities which instigates to act on these opportunities because of the non-motivational individual differences. Abraham Maslow and Frederick Irving Herzberg’ theory of human needs identified psychological forces which drive human behavior. On the contrary, the Trait theory of entrepreneurship identified “certain specific traits or characteristics or competencies which made them capable of generating new ideas and invent new ventures”.

Researchers have shown that the people’s willingness to pursue entrepreneurial opportunities depends on such things as their costs of opportunity, their stocks of financial capital, their social ties with investors and their career experience. In this article the researcher mainly identifies key features of entrepreneurship which includes innovation, risk taking abilities and opportunity spotting. On the other hand, Liñán and Fernandez-Serrano (2014) measures entrepreneurial motivation on multiple dimensions including achievement, challenge and learning, independence and autonomy, recognition and status, social and community motivations and security of income and financial success and so on. Thus individual drivers of entrepreneurial motivation can be differentiated by the contractual drivers such as regional and national characteristics including “macro-economic variables (GDP)”, “formal institutions (systems of welfares and property rights) and informal institutions/national culture” (Dimitratos et al. 2016). Barba-Sánchez and Atienza-Sahuquillo (2012) discussed that the motivational influence of entrepreneurs has a significant role in economic growth. The growth of the nation, typically measured as “GDP per capital” is often considered as “proxy indicator” for the availability of resources to potential entrepreneurs. On the similar context, the deprivation level of the region is used to indicate the availability of opportunities and resources in a region. However, several studies have criticized because no on e investigating direct impacts of economic recession or the level of unemployment on entrepreneurial motivations (Yitshaki and Kropp 2016).  

An entrepreneur is a person who perceives a need that brings together manpower, material, requirement of capital to accomplish that need. In the modern business context, modern economic development is closely linked with production. The entrepreneur directs production and he has the working flexibility which is necessary for its success. In the general perspectives, the motivation is complex psychological phenomenon (Gupta, Chiles and McMullen 2016); it is influenced by the complexity of the individual factors as well as the environmental factors. Here the researcher evaluates how entrepreneurs prefer to manage risk. Compared to steady individual work, there is more uncertainty associated in the development of the new business; entrepreneurs have to bear the relatively high risk. On the contrary, Chell et al. (2016) pointed out that entrepreneurs of the larger organization took risk propensity as a controlled variable as it is found that risk propensity has important relationship between the dependent variable. On the contrary several scholars recognized that entrepreneurs and managers have the difference in risk propensity. However, few have differentiated certain risks on the perspective of entrepreneurs and mangers. On the contrary, there are quite many scholars do not recognize that ten entrepreneur has higher risk propensity. They believe that entrepreneurs of the larger organization have the higher risks propensity because of their small received risk.

According to Yitshaki and Kropp (2016), “Everyone is an entrepreneur when he actually carries out new combinations”. The environmental discovery is all about finding new combinations of factors or production that will become the main divers of the economic development. By this approach, it would be better ways to meet existing demand or develop new products, often making suitable technologies and product obsolete. Dimitratos et al. 2016) stated that the firm of the innovative entrepreneur will grow through the dual process of taking market share from current suppliers and increasing overall demand for the products offered in the market. Therefore, the deliberate entrepreneurial efforts can change market structures and can be propitious for additional innovations and opportunities of profits. This theoretical approach suggests that the cycle of the business are seem as the result of innovation, which consists of the generation of the new idea and its applied in the development of the new product, process and service, leading to the dynamic growth of the nation economy, the increase of employment and generation of profit for the innovative enterprise. However, such innovation must design after the requirements of the human relations. Several researchers referred Mayo’s Theory of Human Relations which addresses social needs of the workers in an organization. This entrepreneurial motivation theory sufficiently motivates employees to put their best effort after considering the social needs of them. In this way, the motivation plays a driving force behind all people’s actions. Those entrepreneurs who understand and use these theories that were developed previously in the literature, will be surely be able to motivate workers to work diligently and productivity.

Practical Application and Deployment:

After discussing entrepreneurial motivation and examining the influences over economic and cultural environment, this researcher developed a clear idea about that there is no single entrepreneurial personality or behaviors are “dynamic” in that they evolve over time. The research explores that work on the behavioral determinants and motivations of entrepreneurs can be divided into characteristics and cognitions (Solesvik 2013). Characteristics include demographics, traits and competencies. Cognitions include pattern recognition, styles of decision making, perception and heuristics. These concepts will enable an individual to understand variables of characteristics such as risk taking abilities and opportunity spotting. Furthermore, this researcher also formulate the idea that entrepreneurship is not solely the result of human actions, but it also influenced by the external factors such as the status of the economy, the actions of competitors, the availability of venture capital. Thus the researcher identified that environmental factors are filed constant but several researchers argued that human motivation plays a critical role in the entrepreneurial process (Frese and Gielnik 2014).  This concept facilitates user to formulate innovative and creative solution for the growth of the nation.  For example, an entrepreneur shall be taken decision regarding the product development after identifying the market opportunities and the organization’s risk taking abilities. However, a creative solution will be considered successful if an entrepreneur comprehensively contributes towards the nation economy after considering the socio-economic factors. The practical demonstration of entrepreneurship must be evaluated by discussed motivational theories. For instance, entrepreneurs will identify the social needs of the workers by the help of Mayo’s theory of human relations. Considering the psychological factors into the entrepreneurship, the authority will definitely manage the economic and cultural work environment. However, the secondary information about the dynamic concepts related to the entrepreneurial motivations shall be understood by the entrepreneur to perform more effectively.

Skills for Professional Practice:

In the general perspective, firm must continuously innovate in order to flexible, competitive and reactive to change. However, an entrepreneur often followed different motivational perspectives for initial of a business and explores how these differences influenced on the business performances. As per the survey report of the “Global Entrepreneurship Monitor” (GEM) (Farhangmehr, Gonçalves and Sarmento 2016) the motivations often evaluated on the basis of conventional –opportunity driven and necessity- driven. For instance, Dav Lewis, the CEO of Tesco was followed a different motivation towards the success of the business. Cutting costs and energizing staff with innovative marketing campaign was the main motivational factor of the CEO (Cohen and Sharma 2016). This is a necessary-driven entrepreneurship skill which practiced for maintaining the competitive edge in the market. To involve in decision making process, the organization has given a perfect evidence of collaborative and working conditions for their employees which greatly motivated them to perform better. A group of health care professionals (HCP) has followed the entrepreneurs’ psychological and cognitive profile and largely influenced the willingness of firm creation (Marques et al. 2013). By this evidence this can be concluded that entrepreneurial motivation has different perspective and largely influenced by the economic and cultural environment. 


Adamu, I.M., Kedah, Z. and Osman-Gani, A.M., 2013. Entrepreneurial motivation, performance and commitment to social responsibility: toward future research. International Journal of Entrepreneurship and Small Business, 18(2), pp.194-210.

Audretsch, D.B., Kuratko, D.F. and Link, A.N., 2015. Making sense of the elusive paradigm of entrepreneurship. Small Business Economics, 45(4), pp.703-712.

Barba-Sánchez, V. and Atienza-Sahuquillo, C., 2012. Entrepreneurial behavior: Impact of motivation factors on decision to create a new venture.Investigaciones Europeas de Dirección y Economía de la Empresa, 18(2), pp.132-138.

Barba-Sánchez, V. and Atienza-Sahuquillo, C., 2012. Entrepreneurial behavior: Impact of motivation factors on decision to create a new venture.Investigaciones Europeas de Dirección y Economía de la Empresa, 18(2), pp.132-138.

Baum, J.R., Frese, M. and Baron, R.A., 2014. The psychology of entrepreneurship. Psychology Press.

Baum, J.R., Frese, M. and Baron, R.A., 2014. The psychology of entrepreneurship. Psychology Press.

Byrne, O. and Shepherd, D.A., 2015. Different strokes for different folks: Entrepreneurial narratives of emotion, cognition, and making sense of business failure. Entrepreneurship Theory and Practice, 39(2), pp.375-405.

Chell, E., Spence, L.J., Perrini, F. and Harris, J.D., 2016. Social entrepreneurship and business ethics: does social equal ethical?. Journal of Business Ethics, 133(4), pp.619-625.

Cohen, A. and Sharma, P., 2016. Entrepreneurs in Every Generation: How Successful Family Businesses Develop Their Next Leaders. Berrett-Koehler Publishers.

Dimitratos, P., Buck, T., Fletcher, M. and Li, N., 2016. The motivation of international entrepreneurship: The case of Chinese transnational entrepreneurs. International Business Review.

Dimitratos, P., Buck, T., Fletcher, M. and Li, N., 2016. The motivation of international entrepreneurship: The case of Chinese transnational entrepreneurs. International Business Review.

Douglas, E.J. and Fitzsimmons, J.R., 2013. Intrapreneurial intentions versus entrepreneurial intentions: distinct constructs with different antecedents.Small Business Economics, 41(1), pp.115-132.

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Garud, R. and Giuliani, A.P., 2013. A narrative perspective on entrepreneurial opportunities. Academy of Management Review, 38(1), pp.157-160.

Garud, R., Gehman, J. and Giuliani, A.P., 2014. Contextualizing entrepreneurial innovation: A narrative perspective. Research Policy, 43(7), pp.1177-1188.

Gupta, V.K., Chiles, T.H. and McMullen, J.S., 2016. A process perspective on evaluating and conducting effectual entrepreneurship research. Academy of Management Review, 41(3), pp.540-544.

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Marques, C.S., Ferreira, J.J., Ferreira, F.A. and Lages, M.F., 2013. Entrepreneurial orientation and motivation to start up a business: evidence from the health service industry. International Entrepreneurship and Management Journal, 9(1), pp.77-94.

Minola, T., Criaco, G. and Obschonka, M., 2016. Age, culture, and self-employment motivation. Small Business Economics, 46(2), pp.187-213.

Sánchez, V.B. and Sahuquillo, C.A., 2012. Entrepreneurial behavior: impact of motivation factors on decision to create a new venture. Investigaciones europeas de dirección y economía de la empresa, 18(2), pp.132-138.

Solesvik, M.Z., 2013. Entrepreneurial motivations and intentions: investigating the role of education major. Education+ Training, 55(3), pp.253-271.

Stenholm, P., Acs, Z.J. and Wuebker, R., 2013. Exploring country-level institutional arrangements on the rate and type of entrepreneurial activity.Journal of Business Venturing, 28(1), pp.176-193.

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Yitshaki, R. and Kropp, F., 2016. Motivations and opportunity recognition of social entrepreneurs. Journal of Small Business Management, 54(2), pp.546-565.

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