Entrepreneurial propensity in a transition economy: exploring micro‐level and meso‐level cultural antecedents

This paper aims to analyze antecedents of entrepreneurship propensity in two separate studies, at individual and organizational levels. The first study proposes that the effect of individual cultural values on entrepreneurial propensity is mediated by the locus of control. The second study focuses on the interaction effect between the individual's need for autonomy and a bureaucratic culture characterized by high centralization and high formalization.

The approach takes the form of surveys of business students and retail salespeople in Romania and regression analysis.

Internal locus of control predicts entrepreneurship propensity. Mediation effects were not supported. Centralization and formalization stimulate entrepreneurial propensity, especially in salespeople with a high need for autonomy. In general, the individual cultural values approach generated weak results, while the organizational culture approach showed strong support for the hypotheses.

A combination of push and pull effects determines an individual's entrepreneurial propensity. Personality traits, such as internal locus of control and need for autonomy predict entrepreneurial propensity. But individuals are pushed into entrepreneurship by negative factors, such as dissatisfaction with existing employment.

In transitional economies, entrepreneurial ventures are relied on to sustain a high growth rate, to serve the unmet needs of the population, and to create jobs. Multinationals operating in transition countries could improve recruiting decisions by hiring managers with a high internal locus of control and could then allow them decision‐making power to satisfy their need for autonomy.

The paper analyzes antecedents of entrepreneurship propensity in two separate studies, at micro (individual) and meso (organizational) levels, but set within the same transitional economy. This macro context is posited to shape both organizational culture and individual cultural values and personality traits.