Risk tolerance: A perspective on entrepreneurship education

The field of entrepreneurship in South Africa has certain unique although limiting characteristics, including an unconvincing enabling environment, a weak entrepreneurial culture and an emergent, and therefore limited, body of knowledge surrounding the topic of entrepreneurship. Consequently, entrepreneurship in South Africa does not hold a strong position in terms of entrepreneurial activity and, in fact, is generally approached with a degree of scepticism. At the same time, Maas & Herrington in the Global Entrepreneurship Monitor (GEM) (Maas & Herrington 2006: 12) indicate categorically that an increase in entrepreneurial activity is highly dependent on effective entrepreneurship education. This study confirmed the fact that education per se may increase the current Total Entrepreneurial Activity rate of 5.29% in South Africa, as compared with 14.8% in other developing countries. An aspect of entrepreneurship that is currently not adequately addressed in entrepreneurship education and training literature is that of risk tolerance and risk-taking of the entrepreneur. Debate on whether entrepreneurs exhibit higher risk tolerance than other managers and full-time employed individuals is ongoing and raises the question of whether risk tolerance should be included in entrepreneurship curricula. This study seeks to elaborate on this debate.