The entrepreneurial dilemma: the interplay between risk taking, happiness and entrepreneurial intention

In this paper, we develop a theoretical model to explain the interplay between individuals’ risk attitudes and happiness on their intention to become entrepreneurs. Our model illustrates that for risk averse individuals, the greater the level of happiness, the lower their willingness to become entrepreneurs. Conversely, if individuals are risk seekers, the higher their level of happiness, the greater their willingness to become entrepreneurs. We test the model using data from the Bank of Italy’s Survey of Household Income and Wealth (SHIW) and the empirical results confirm the proposition set by our model.