Positive Illusions and New Venture Creation: Conceptual Issues and AN Empirical Illustration

Sammendrag

This paper discusses the nature and role of positive illusions in the explotiation of new ideas and innovation leading to the development of new enteprises and industries. Positive illusions imply misperceptions of oneself and the environment that can lead to faulty investments and bankrupticies. However, without the optimistic misperceptions of one`s own abilities and opportunites that positive illusions imply, little or nothing would happen. Thus, illusions that lead to initiative and commitment are crucial to create and exploit new innovations, even though venturing into new business areas always involves risk and potential failure.