Risk Perception and Entrepreneurial Career Choice : A Comparative Analysis of First Generation Entrepreneurs and Service Holders

The process of choosing one's career such as whether to become an entrepreneur or otherwise, has been subject to a lot of research, especially in the area of decision making. The Theory of Planned Behavior (TPB) (Ajzen, 1991) has perhaps been the single most referred approach in understanding such decisions. However, there have been numerous cases where this does not hold good such as for the people who do not consciously intend to become an entrepreneur but find themselves becoming an ‘accidental entrepreneur' (Fitzsimmons and Douglas, 2010). The current paper attempts to incorporate the idea of risk perception of a person as an explanation of such choices. The study introduced the DOSPERT scale (Weber et al., 2002) to a set of first generation entrepreneurs (test group) and service holder (control group), to understand if there is any significant difference between the two groups, based on which some out of sample cases can be identified. The results of the study confirm significant difference through logistic regression modeling and was able to identify 66% cases correctly based on only six generic risk perception variables and a few other demographic variables. Thus, it is established that generic risk perception may be added to the TPB model to significantly improve the model in accurately identifying entrepreneurial career choices