Entrepreneurship policy for entrepreneurs : a cognitive approach to the entrepreneurial environment

Abstract

Entrepreneurship stimulates economic growth, creates jobs, and provides opportunities for independence and self-realization. Over the last 10 years, policy makers around the globe have been actively pursuing the elusive goal of an entrepreneurial economy. Often building on existing Small and Medium-Sized Enterprise (SME) policy, efforts have been taken to encourage entrepreneurship by, for example, reducing red-tape and improving access to financing. However, these efforts do not appear to be having the hoped effect of fostering more entrepreneurship. Starting from the maturing field of literature that applies cognitive science to entrepreneurship, this thesis examines what motivates entrepreneurs to start new ventures. I then use this understanding to develop policy options that aim to directly target individuals and foster more entrepreneurship as a unique interdisciplinary contribution to the literature on entrepreneurship policy. This thesis develops a framework for a cognitive approach to policy, which aims to put the entrepreneur at the heart of entrepreneurship policy. The cognitive approach is a tool for policy-makers to enable them to more readily understand entrepreneurs' mindsets and the policy options that can foster entrepreneurial intentions in their constituencies. In applying the cognitive approach to the entrepreneurial environment, this thesis shows that the types of policies necessary for fostering entrepreneurship are different from those currently favored by policy makers. Unlike SME policies, fostering entrepreneurship requires policies that help individuals build self-efficacy and entrepreneurial intentions through personal experiences, networks, feedback and mentorship. In the final chapters, the cognitive framework is applied to the MIT-Portugal Program, demonstrating how to apply this framework pragmatically and highlighting considerations for exporting entrepreneurship curricula from MIT to Portugal.