Portal de Periódicos da CAPES

Entrepreneurial overconfidence and ambiguity aversion: dealing with the devil you know, than the devil you don't know

2015; Taylor & Francis; Volume: 27; Issue: 8 Linguagem: Inglês

10.1080/09537325.2015.1037266

1465-3990

Desmond Ng,

Private Equity and Venture Capital

Various empirical studies find that entrepreneurs are systematically overconfident in their venture's probabilistic chances of success. Yet, entrepreneurs often face an ambiguous future that precludes them from making such probabilistic judgements. A theoretical framework based on ambiguity aversion is developed to explain an entrepreneur's overconfidence under complex and novel conditions of ambiguity. Unlike optimistic explanations, this ambiguity-averse form of overconfidence offers a non-probabilistic approach to entrepreneurial judgements of uncertainty.