According to the experiental learning theory, individuals learn from past experiences (Kolb, 1984; Boyazis & Kolb, 1995), and entrepreneurs also learn from failure (Minniti & Bygrave, 2001). Failure can be extremely important, because it reduces entrepreneurs’ confidence in actions that have been successful earlier, and forces them to continue the search for alternative options. It also evokes negative emotions, which if prolonged restrain the recovery process and hinder learning (Shepherd, 2003). Earlier research has suggested that the time needed for recovery is influenced at least by the financial and emotional costs of the business closure and by anticipatory grieving (Shepherd et al., 2007), coping self-efficacy (Benight & Bandura, 2004), emotional intelligence (Shepherd, 2007) and more specifically, by emotion regulation and self-leadership capabilities of the entrepreneur (Gross, 2002).
Arenius, Pia and Franzén, Riikka
"RECOVERING FROM FIRM FAILURE: EVIDENCE FROM SEVEN CASES (INTERACTIVE PAPER),"
Frontiers of Entrepreneurship Research: Vol. 29
, Article 14.
Available at: http://digitalknowledge.babson.edu/fer/vol29/iss4/14