Expectancy Theory of Entrepreneurship
What is the Expectancy Theory of Entrepreneurship? Expectancy theory was originally developed to explain work motivation and organizational behavior ( Kanfer, 1990 ). However, it has since been used to explain additional behaviors, including the decision to enter into entrepreneurship. Understanding Vroom's Equation Expectancy theory begins with the concept of motivational forces that Victor Vroom (1964) expressed as a specific equation: MF = V × I × E In this formula: V = Valence: The value an individual places on the outcome of their efforts (such as financial rewards or prestige). I = Instrumentality: The belief that if an individual meets performance expectations, they will actually receive the reward. E = Expectancy: The belief or probability that an individual’s effort will result in the desired goal being achieved. Note: Since the equation involves multiplication, it implies that if any one of these variables is zero, the tot...
