Narcissism and learning from entrepreneurial failure

• Published in: Journal of business venturing Vol. 34; no. 3; pp. 496 - 512
• Main Authors: Liu, Yiran, Li, Yong, Hao, Xiling, Zhang, Yuli
• Format: Journal Article
• Language: English
• Published: Elsevier Inc 01-05-2019
• Subjects: Entrepreneurship; Failure costs; Learning from failure; Narcissism; Failure costs; Narcissism; Learning from failure; Entrepreneurship
• ISSN: 0883-9026; 1873-2003
• DOI: 10.1016/j.jbusvent.2019.01.003

Failure of a prior business provides an opportunity for an entrepreneur to learn in the subsequent entrepreneurial endeavor, but learning from failure is not guaranteed. Why do some entrepreneurs learn less from failure than others? In this study, we propose that a narcissistic personality can create cognitive and motivational obstacles to learning. We further posit that the inhibiting effect of narcissism will be more salient when the costs of failure, especially social costs, are higher. Our analysis with a survey sample of startups provides the initial empirical evidence about the negative impact of narcissism on learning from entrepreneurial failure. The study adds to research on learning from failure and narcissism in entrepreneurship.
•We extend the entrepreneurial learning literature by moving the focus from the emotional and cognitive obstacles of learning to the motivational impediments to learning. Specifically, by drawing on the motivational element of the narcissism concept, our study shifts attention from when entrepreneurs learn more effectively to when entrepreneurs are less willing to learn.•Research suggests that narcissism may influence entrepreneurial orientation, intention, opportunity recognition and exploitation, and firm performance. Yet, how narcissism impacts learning has largely been assumed. This study offers a systematic analysis of how narcissism impedes learning, by conceptually elaborating on the cognitive and motivational obstacles for narcissistic entrepreneurs to learn from failure.•We introduce failure cost as a boundary condition to highlight when narcissists are less motivated to learn. Prior research has primarily examined how positive social cues may motivate narcissists to take bold, positive actions. What is less understood is how negative social cues influence narcissists’ behavior. Our study offers the insight that perceived social costs of failure will reduce narcissists’ reported learning.•There are plenty of theoretical discussions on learning from failure but few empirical analyses. Our study provides the initial empirical evidence about the negative impact of narcissism on learning from failure. Further, empirical studies on narcissism and entrepreneurship have primarily focused on CEOs or students. Our research represents one of the first that empirically studies narcissism of real world entrepreneurs.