Entrepreneurial Stress: Is it Hazardous to Your Health?

Entrepreneurship is playing an increasing role in the U.S. economy. Kirchoff and Phillips (1988) reported that small firms are the major source of new job creation. New business ventures accounted for 55% of new jobs between 1970 and 1980 (Hoy and Carland, 1983). New firm creation enhances economic growth and expansion. However, entrepreneurship is a risky process; while more than five hundred thousand businesses are started each year, only one in five survives for ten years (Wall Street Journal, 1982: 15). Recognizing the need to understand the nature of this influential business segment, researchers have begun to focus on the nature of entrepreneurship. For purposes of this study, an entrepreneur is defined as one who innovates, creating a new business and assuming full authority and control of the venture (Cunningham and Lischeron, 1991). Although an entrepreneur clearly has managerial responsibilities, the venture creation process adds a unique element to entrepreneurship. Do entrepreneurs experience high levels of stress in the initiation and management of a new business? The three research questions posed by this study are: 1. Is the nature of entrepreneurial stress different from managerial stress, 2. What factors in venture creation and growth are related to entrepreneurial stress, and ? 3. Do personality and behavioral characteristics moderate the relationships between en-trepreneurial stressors and health and job satisfaction? What causes stress? Kahn et al. (1964) and Kahn and Quinn (1970) view stress as a function of discrepancies between one's expectations and one's ability to meet demands, and discrepancies between the individual's expectations and his/her personality. When one is unable to fulfill one's role demands, stress occurs. To the extent that entrepreneurs' work demands and expectations exceed their abilities to perform as venture initiators, they are likely to experience stress. However, entrepreneurs and their role demands differ from those of managers as the next section shows.