Abstract

Expectancy-based theories are among the most studied cognitive theories of motivation and have been particularly useful in the examination of choice between alternative behaviors. Expectancy x value theory suggests that individuals seek utility maximization; i.e. a positive interaction between expectancy and value. In this paper, we compare the way that entrepreneurs use expectancy and value in their decision policies for startup decisions versus persistence decisions. We argue that the interaction between expectancy and value will be significant and positive (utility maximization) in the startup decision but the interaction between expectancy and value will be negative when choosing whether or not to persist.

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