Cultural context, passion and self-efficacy: do entrepreneurs operate on different ‘planets’?

We explore how national culture impacts emotional and cognitive processes of entrepreneurs. In particular, we extend the recent conceptual work on entrepreneurial passion by linking it to the theoretical lens on situated emotions. We also extend current work on entrepreneurial cognitions by suggesting that cognition is distributed among group processes and the environment. We propose a culturally situated model of entrepreneurial emotions (e.g., entrepreneurial passion) and cognitions (e.g., selfefficacy), and explore how these impact venture performance. We test the model in two different cultures – Slovenia and the USA – to show that the strength of feelings of entrepreneurial passion varies among entrepreneurs from different environments. In addition, we find that there are cultural differences in the manifestation of entrepreneurial selfefficacy and different domains of entrepreneurial passion, as well as the relationship between them and firm innovation and market share. We discuss implications for research and practice. CULTURE, EMOTIONS AND COGNITIONS OF ENTREPRENEURS Entrepreneurship scholars and practitioners have been recently fascinated by a specific emotion – entrepreneurial passion, the ‘most observed phenomenon in the entrepreneurial process’ (Smilor, 1997: 342). Entrepreneurial passion (EP) involves consciously accessible, intense positive feelings that result from engagement in activities that have identity meaning to an entrepreneur (Cardon, Wincent, Singh and Drnovšek, 2009). As an intense positive emotion, passion contributes to a better understanding of entrepreneurial behaviors and outcomes (Cardon et al., MITCHELL 9781781006580 PRINT (M3560) (G). indd 227 15/10/2014 07:53 228 Handbook of entrepreneurial cognition 2009; Foo, Uy and Baron, 2009). Emotions such as passion often work alongside cognitions, which have long been acknowledged to provide theoretically rigorous and testable explanations of how entrepreneurs think and why they do some of the things they do (Mitchell et al., 2002), as well as how such behaviors lead to specific outcomes (see also Baron, Chapter 1, this volume; Bird, Chapter 3, this volume). Among entrepreneurial cognitions, entrepreneurial selfefficacy (ESE) has been seen as one of the most important cognitions impacting entrepreneurial behaviors and outcomes. ESE refers to the extent to which an entrepreneur believes that he/she can complete various roles and tasks of entrepreneurship (Boyd and Vozikis, 1994; Chen, Greene and Crick, 1998). If entrepreneurial emotions, specifically entrepreneurial passion (EP), are seen in the heart of the entrepreneurial process (Cardon, Foo, Shepherd and Wiklund, 2012), entrepreneurial cognitions, specifically entrepreneurial selfefficacy, may be seen as a ‘willpower’ of entrepreneurship since it has been shown to provide entrepreneurs with the strength necessary to persist despite the obstacles they encounter on their entrepreneurial journeys (Chen et al., 1998). The context within which entrepreneurial cognitions and emotions interact while entrepreneurs pursue their goals is also important (Izard, 1978). Because entrepreneurs act and make decisions in response to opportunity under uncertainty, and evaluate the desirability and feasibility of an opportunity and exploit it (McMullen and Shepherd, 2006; Shane and Venkataraman, 2000) within a specific context, some variations in this dynamic process can be ascribed to differences in national contexts within which the entrepreneurial process emerges (Aldrich et al., 1991). Indeed, an aspect of society that critically shapes the environment for organizations has been identified in the literature – culture, including its norms and values. Because national cultures have different values and norms about entrepreneurship, entrepreneurial endeavors and performance are viewed in different ways (Ekman, 1992). By exploring the role of national culture in the entrepreneurial process, we can better understand how culture influences motives, values and beliefs of entrepreneurs (Frijda, 1987). Although extant culturerelated research in entrepreneurship has so far provided tremendous insights (e.g., Aldrich et al., 1991; Hayton, George and Zahra, 2002), there are several theoretical and empirical gaps in our understanding about the impact that national culture might have on the emergence and effects of entrepreneurial cognitions and emotions. One unanswered question is how culturerelated factors influence the emergence and development of emotional and cognitive processes of entrepreneurs. To our knowledge, the entire published set of empirical data on entrepreneurial passion has been collected in a North American MITCHELL 9781781006580 PRINT (M3560) (G). indd 228 15/10/2014 07:53 Cultural context, passion and self-efficacy 229 setting, with one exception, which was collected in Germany (Breugst, Domurath, Patzelt and Klaukien, 2012). Similarly, despite a rich cumulative body of research on entrepreneurial cognitions, most of the empirical studies involving entrepreneurial cognitions have been conducted in AngloSaxon environments. In this chapter we seek to address these limitations and to make the following contributions. First, we explore how entrepreneurial passion develops across cultures and whether entrepreneurs in different environments tend to experience passion differently. Central to the nature of entrepreneurial passion is an entrepreneur’s selfidentity, namely the role identity of inventor, founder and developer. Given that all identities begin as social roles (Stryker and Burke, 2000), their emergence is socially situated. Furthermore, individuals learn what it means to be an entrepreneur by first viewing how society interprets that particular social role (Murnieks, Mosakowski and Cardon, in press: 7). By exploring in Hypothesis 1 how the strength and focus of entrepreneurial passion differs among countries, we offer some preliminary explanations for the contextrelated variations in experiencing different types of entrepreneurial passion. We specifically look at the extent to which culture influences the amount of passion that is experienced, as well as the focus of that passion (on the inventor, founder and/or developer roles). Our second contribution aims to explore how a specific emotion and a specific cognition relate to venture performance in two different cultural contexts. Recently, several authors (e.g., Mitchell, RandolphSeng and Mitchell, 2011) suggested the need to explore how cognitive, motivational and emotional processes of entrepreneurs interact within specific social situations and with specific social actors. The emerging theory on situated emotions in psychology (Keltner and Haidt, 1999; Parkinson, Fischer and Manstead, 2005) suggests that environment plays an active role in structuring and enabling emotional engagements, and is in turn influenced by the unfolding of emotions. We integrate this theoretical perspective with existing conceptual work on entrepreneurial passion to develop a culturally situated model of entrepreneurial cognitions (e.g., entrepreneurial selfefficacy) and entrepreneurial emotions (e.g., entrepreneurial passion) in Hypotheses 2 and 3 and explore how those in turn affect venture performance on a large data set of practicing entrepreneurs in two different cultural environments. We also follow the idea of distributed cognition (Smith and Semin, 2004), suggesting that cognition is distributed among group processes and the environment so that ‘the social context of speaking and interactions with others affect the construction of meaning about a new venture’ (Cornelissen and Clarke, 2010: 542). For example, Bandura (1994) suggests that an important means of strengthening one’s selfefficacy is through vicarious learning and social persuasion. We look MITCHELL 9781781006580 PRINT (M3560) (G). indd 229 15/10/2014 07:53 230 Handbook of entrepreneurial cognition at samples of entrepreneurs in the countries of Slovenia and the USA, and specifically at firmlevel market share and innovation associated with entrepreneurial passion and entrepreneurial selfefficacy. The remainder of the chapter is organized as follows. We begin with a brief review of theories of situated emotions and cognitions that we use as foundations for our arguments about the role of culture in impacting individuals’ emotions and cognitions. Specifically, we first investigate differences in experienced entrepreneurial passion in two different cultural contexts, as previous studies did not investigate in detail such cultural distinctions of emotions. We then focus on the relationship between entrepreneurial passion, entrepreneurial selfefficacy and venture performance, and develop propositions supporting these links. The rest of the chapter summarizes our methods, data from samples in Slovenia and the USA, and results. We conclude with a discussion of the study and its implications for future research. THEORY AND HYPOTHESES DEVELOPMENT Emotions and Cognitions: A Situated Perspective The situated perspective of emotions maintains that individuals’ emotions are scaffolded by the environment (Griffiths and Scarantino, 2005; Parkinson et al., 2005): emotions are designed to function in a social context, and the environment in which they unfold influences them and is influenced by them. Although emotions are often privately experienced, they are most often expressed and often observed by others, who in turn respond to them (Van Kleef, 2010). By being (visually) expressed, emotions serve social functions, have interpersonal consequences (Van Kleef, 2010), and are shaped by cultural practices and symbol systems (Hareli and Parkinson, 2008). A specific social role that emotions play is regulation of social interactions, influencing not only the behavior of the ‘emoter’ but also that of others in the social environment (Elfenbein and Ambady, 2002; Frijda, 2009; Parkinson et al., 2005) because emoti