What is the planned behavior theory of entrepreneurship?The theory of planned behavior was developed by Polish social psychologist Icek Ajzen (1991) to predict a variety of social behaviors in different fields including consumer behavior, politics, and healthcare.
According to the theory, the most important determinants of an individual’s behaviors is their intention to engage in the behavior—not their attitudes toward behaviors as these are only expected to affect intentions. Thus, for example, if a potential voter has the intention to vote they are more likely to vote than if they merely think voting is a good thing to do.
The theory hangs on the concept of intentions, which are defined as an individual’s motivation and conscious decision or plan to expend effort to bring about a behavior. The link between intention and action is expected to be stronger when there is a short time gap between them and when there is an appropriate level of specificity between the intention and the action to be taken. Continuing our example, if a voter has an intention to vote in a nearing election at a specified location and for a specified party and level of government, they are more likely to carry out their intention.
When applied to entrepreneurship, the theory suggests that engaging in entrepreneurship is intentional and therefore is better predicted by intentions as opposed to personality, demographic characteristics, attitudes or beliefs.
The theory suggests full mediation, such that studies should always use exogenous factors to predict an individual’s intention to become an entrepreneur and not propose models that link exogenous factors directly to entrepreneurial behaviors.
Entrepreneurial intentions are now widely studies with many researchers trying to predict intention formation with a wide variety of antecedents such as self-efficacy and human capital. However, there is still some skepticism about the theory because entrepreneurial intentions do not always translate into entrepreneurial action. Sometime entrepreneurial action is not called for, and promoting entrepreneurial intentions may not be helpful if other factors are not in place.