How does prosocial motivation influence the probability of an entrepreneur registering a new firm? An analysis of its interaction with business gestation activities

Abstract

This study focuses on the prosocial motivation of entrepreneurs and its influence on the creation of a new firm, which is a novel approach with respect to other intrinsic and extrinsic motivations present in the entrepreneurial process that have been extensively studied by the academia. Using data from the Panel Study of Entrepreneurial Dynamics (PSED-Spain), we categoryze the different types of activities that entrepreneurs carry out before registering the firm. We find out that prosocial motivation not only has a direct positive influence on the probability of creating a new firm, but also positively moderates the relationship between undertaken investment activities and the probability of registering the firm. On the contrary, prosocial motivation does not seem to interact with market and resource mobilisation activities, which are inversely related to firm registration. Within the framework of Self-Determination Theory, this paper extends the limited previous research on the role of prosocial motivation in the entrepreneurial process and opens up new lines of future research.