Abstract

Recently, research has focused attention on the cognitive processes of entrepreneurs. We examine the relationship between an individual’s “need for cognition”—the need to understand and make sense of the experiential world— and the use of biases and heuristics in entrepreneurial decision-making. A significant number of studies examining cognitive mechanisms show that entrepreneurs may indeed think differently than others. The use of cognitive biases and heuristics may benefit entrepreneurs in making decisions to act more quickly and efficiently. Social psychology literature suggests that individuals who are high in the need for cognition may be less susceptible to a variety of decision-making biases. Hence, we seek to answer the following questions: (1) Is the need for cognition inversely related to the use of biases in entrepreneurial decision making? (2) Due to the high level of ambiguity in entrepreneurial situations, are individuals with a high need for cognition more or less likely to act entrepreneurially?

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