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Based on the Kahneman & Tversky (1979)‘s prospect theory, Lee & Venkataraman (2006) proposed an entrepreneurial decision‐ making model. In this article, by applying work motivation theories to the model, we develop a set of hypothesis about the rate of entrepreneurship. This research analyzes how changes in environmental factors can affect an individual’s aspiration level and his utilities of available market opportunities. Here are the longitudinal regression analysis results supporting the new entrepreneurial decision‐making model. First, we show that the real wage income is one of the best predict variables for the rate of entrepreneurship. Second, the results of our longitudinal regression analysis coincide with the hypothesis developed in this paper.

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