Social identity theory and entrepreneurship

Social identity theory came out of Henry Tajfel and John Turner (1979) experiments showing that the slightest priming of group membership creates prejudice. “Blue eyes, a preference for the paintings of Wasily Kandinsky over those of Paul Klee, and calling some people over-estimators and others under-estimators were sufficient to produce a preference for fellow group members and to elicit discrimination against outsiders” (Huddy, 2001:132).

Social identity theory has been used to explain why human personalities and behaviors seem to be context-specific. A given individual may act differently depending on which groups they perceive themselves to belong. The theory suggests that personal identity plus environmental conditions shape social identity, which in turn leads to categorization of others into in-groups and out-groups.

Obschonka et al. (2012) argue that individual beliefs and attitudes are unlikely to be the main drivers of entrepreneurship. Rather, they use social identity theory to suggest that individuals take on the norms of the groups they join. Thus, for example, if a scientist joins an entrepreneurial faculty, they are more likely to consider entrepreneurship as a career route. This is in sharp contrast to many of the psychological theories of entrepreneurship that look to individual attitudes and beliefs to predict entrepreneurial intentions. 

Obschonka et al. (2012) studied hundreds of German scientists and found that those that strongly identified with their peer groups were more likely to have entrepreneurial intentions if their peer group had entrepreneurial norms. In contrast, individuals that did not identify with their peers were more likely to engage in entrepreneurship if they had a high level of internal locus of control. They explain that a higher level of social identification appears to be associated with lower internal locus of control, causing individuals to rely on group norms as a substitute. 

The theory has interesting implications relating to entrepreneurial cultural norms in organizations such as universities, corporations and incubators.  It suggests that individuals with a weak internal locus (strong external locus) of control may become more entrepreneurial if they join a group with entrepreneurial norms. It also seems to imply that individuals with already strong internal locus of control may not experience changes in their entrepreneurial intentions as a result of joining entrepreneurial groups. Clearly, more research, in more diverse contexts is needed to draw strong conclusions.


Interesting video on social identity:


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