A hubris theory of entrepreneurship

Mathew L.A. Hayward, Dean A. Shepherd, Dale Griffin

Research output: Contribution to journalArticleResearchpeer-review

398 Citations (Scopus)


This paper develops a hubris theory of entrepreneurship to explain why so many new ventures are created in the shadow of high venture failure rates: More confident actors are moved to start ventures, and then act on such confidence when deciding how to allocate resources in their ventures. Building on theory and evidence from the behavioral decision-making literature, we describe how founders' socially constructed confidence affects the manner in which they interpret information about their prior and current ventures. We then link founders' propensity to be overconfident to their decisions to allocate, use, and attain resources. In our model, founders with greater socially constructed confidence tend to deprive their ventures of resources and resourcefulness and, therefore, increase the likelihood that their ventures will fail.

Original languageEnglish
Pages (from-to)160-172
Number of pages13
JournalManagement Science
Issue number2
Publication statusPublished - 1 Feb 2006
Externally publishedYes


  • Confidence
  • Entrepreneurship
  • Hubris
  • Resources
  • A hubris theory of entrepreneurship

    Hayward, M. L. A., Shepherd, D. A. & Griffin, D., 2014, A Psychological Approach to Entrepreneurship: Selected Essays of Dean A. Shepherd. Shepherd, D. A. (ed.). 1st ed. Cheltenham UK: Edward Elgar Publishing, p. 248-260 13 p.

    Research output: Chapter in Book/Report/Conference proceedingChapter (Book)Otherpeer-review

    3 Citations (Scopus)

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