Economic policy uncertainty and new venture initiation: The role of opportunity belief and uncertainty avoidance

Abu Zafar M Shahriar, Mahabubur Rahman, Mokter Hossain and Masoud Karami
Additional contact information
Abu Zafar M Shahriar: Monash University, Australia.
Mahabubur Rahman: Rennes SB - Rennes School of Business
Mokter Hossain: Qatar University
Masoud Karami: MMU - Manchester Metropolitan University

Post-Print from HAL

Abstract: This article examines how economic policy uncertainty (EPU) shapes individual decisions to initiate new ventures. We develop and test a multilevel framework in which EPU influences entrepreneurial action via the cognitive mechanism of opportunity belief, moderated by the cultural context of uncertainty avoidance. Drawing on institutional theory and a dataset comprising 677,715 individuals across 22 countries, covering 2010 – 2018, compiled from four data sources, we find that individuals are less likely to pursue new ventures in countries with high EPU, partly because such uncertainty undermines their belief in the availability of viable business opportunities. This effect is amplified in societies with high uncertainty avoidance, where unpredictability is perceived as more threatening. By identifying opportunity belief as a key mediating mechanism and national culture as a boundary condition, this study advances a more integrated understanding of how institutional and cultural contexts jointly shape entrepreneurial behaviour under institutional uncertainty.

Keywords: new venture initiation; uncertainty avoidance; opportunity belief; economic policy uncertainty (search for similar items in EconPapers)
Date: 2025-11-26
References: Add references at CitEc
Citations:

Published in International Small Business Journal, 2025, 44 (3), pp.314-337. ⟨10.1177/02662426251375896⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05670416

DOI: 10.1177/02662426251375896

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().