"Of Course I Can": The Effect of CEO Overconfidence on Entrepreneurially Oriented Firms. (September 2015)

• Record Type: Journal Article
• Authors: Engelen, Andreas; Neumann, Christoph; Schwens, Christian
• Is Part Of: Entrepreneurship theory and practice. Volume 39:Number 5(2015:Sep.)
• Page Start: 1137
• Page End: 1160
• Publication Date: 2015-09
• Subjects: Small business -- Periodicals; New business enterprises -- Periodicals; Entrepreneurship -- Periodicals; 658.421
• DOI: 10.1111/etap.12099
• Languages: English
• ISSNs: 1042-2587

Abstract

Guided by the upper echelons theory, this research examines the relationship between chief executive officer (CEO) overconfidence and a firm's entrepreneurial orientation (EO). The study theoretically establishes and empirically validates an increasing effect of CEO overconfidence on EO, although at a decreasing rate. Empirical results are based on a multisource secondary data set for high–tech S&P 500 firms from 2005 to 2007. Findings further indicate that the proposed relationship between CEO overconfidence and EO is moderated by market dynamism. A theoretically established moderating effect of market concentration could not be validated empirically.