Can Culture Account for Investment Expectations?
Résumé
Until recently, risk-taking in investment decisions has been explained by
cognitive biases and emotional urges. I would like to propose an alternative
explanation, based on the work of Pierre Bourdieu, who links cultural capital to
risk-taking. His concept of cultural capital has a very broad meaning, as it
encompasses technical skills, aesthetic preferences, verbal facility, general cultural
awareness, educational credentials, and artistic competencies. On theoretical
grounds, one can assume that a high level of cultural capital enables the taming of
uncertainty and allows for temporal horizons that cover longer terms. I test this
hypothesis by conducting and analyzing a survey of 307 entrepreneurs. I define risktaking
in two ways: (i) in a somewhat mainstream way, on the basis of expected
utility, and (ii) in a heterodox way, in a qualitative, context-dependent setting. I
find that, in both cases, there seems to be a link between cultural capital and risktaking.
Furthermore, it seems to make financing issues more salient. I conclude by
opening a discussion about the heterogeneity of entrepreneurs and their animal
spirits.
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