There are, quite literally, thousands of academic studies that examine why people want to run their own companies. So it’s unusual to come across a new paper that takes a novel enough angle on interest in entrepreneurship for me to write a post about it.
But here’s a new explanation from a recent article  in the academic journal, Entrepreneurship Theory and Practice. It’s exposure to prenatal testosterone.
Yes, you read that right.
People who are exposed to more testosterone in utero are more likely to want to be entrepreneurs than people who are exposed to less of this hormone in the womb.
But before I get to the evidence, let me start with the theory for why.
Testosterone doesn’t just matter to the development of sex organs and building muscle mass, it also plays an important role  in brain development. While the exact ways early testosterone exposure affects the brain aren’t well understood, studies show that people exposed to more testosterone in utero are more willing to take risks later in life.
The higher propensity to take risks, in turn, makes people more likely to go into business for themselves.
Three scholars who (appropriately) work at the Schumpeter School of Business and Economics at the University of Wuppertal in Germany (Diemo Urbig, Werner Bonte, and Vivien Procher), studied 579 German undergraduates. They found  that those students who were exposed to more prenatal testosterone — as demonstrated by a higher ratio of their ring fingers to the middle fingers, a common test of this exposure — had greater entrepreneurial intent, which they defined as “a self-acknowledged conviction by a person that they will set up a new business venture and consciously plan to do so at some point in the future.”
Moreover, the authors discovered that the increased testosterone exposure boosted risk tolerance, which led to the higher interest in entrepreneurship.
This study is one in a line of papers by different academics showing that people with more exposure to prenatal testosterone are more likely to be entrepreneurs than other people.
The University of Wuppertal scholars’ contribution was to show that early exposure to testosterone affects the odds of being an entrepreneur by increasing risk-taking propensity, a pathway hypothesized, but not tested, by previous scholars.
Sonogram  photo via Shutterstock