Document Type

Journal Article

Department/Unit

Department of Management

Title

Social trust and angel investors' decisions: A multilevel analysis across nations

Language

English

Abstract

© 2014 Elsevier Inc. The decisions made by angel investors are embedded in and influenced by their institutional settings. This paper advances a multilevel model of the direct and indirect effects of social trust on individuals' angel-investment decisions. It is postulated that two dimensions of social trust, namely the level and radius, can enhance information transmission, collaboration, and sanctioning mechanisms within a society. Consequently, they facilitate angel investment and moderate the relationship between it and individual factors. A multilevel model of data from 191,907 individuals across 25 countries shows that individuals in countries with a high level of trust are more likely to make angel investments. Whereas both the level of trust and the radius of trust are found to heighten the positive relationship between an individual's perceived entrepreneurial skills and angel investment, it is interesting to note that these factors weaken the relationship between the perception of new business opportunities and angel investment. These direct and moderating effects are robust after controlling for wealth, cultural values, and other factors. This study contributes to the crossover between research on entrepreneurship and social-trust research.

Keywords

Angel investment, Comparative entrepreneurship, Entrepreneurship, Institutional perspective, L26, Social trust

Publication Date

2015

Source Publication Title

Journal of Business Venturing

Volume

30

Issue

2

Start Page

307

End Page

321

Publisher

Elsevier

DOI

10.1016/j.jbusvent.2014.08.003

ISSN (print)

08839026

This document is currently not available here.

Share

COinS