What question did this study set out to answer?

To explore how reference point adaptation (RPA) impacts risk perceptions in entrepreneurial decision-making.

April 19, 2026Journal of Business Venturing Insights0 citationsOpen Access

Reference point adaptation: How entrepreneurs adjust risk perceptions after experiencing gains or losses

RSRachel Saef NSNicholas A. Smith TMTimothy L. Michaelis

Key Points

To explore how reference point adaptation (RPA) impacts risk perceptions in entrepreneurial decision-making.
Introduced RPA through Prospect Theory framework
Analyzed the influence of dispositional traits on risk reference point adjustment
Investigated the moderating effects of self-esteem and locus of control
Entrepreneurs adjust risk perceptions based on previous gains or losses
Self-esteem influences the adaptation to risk-taking behavior
Individual differences significantly affect responses to entrepreneurial gains and losses

Abstract

• Introduces reference point adaptation (RPA) to entrepreneurial decision making via Prospect Theory. • Dispositional traits can influence how entrepreneurs adjust risk reference points. • Self-esteem and locus of control moderate the RPA to risk-taking behavior relationship. • Highlights individual heterogeneity in how entrepreneurs respond to gains and losses.

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