Macroeconomic Uncertainty and Risk: Collective Optimism of Small-Business Owners. (September 2022)

• Record Type: Journal Article
• Authors: Patel, Pankaj C.; Tsionas, Mike
• Other Names: Bertoni Fabio guest-editor.; Bonini Stefano guest-editor.; Capizzi Vincenzo guest-editor.; Colombo Massimo G. guest-editor.; Manigart Sophie guest-editor.
• Is Part Of: Entrepreneurship theory and practice. Volume 46:Number 5(2022)
• Page Start: 1402
• Page End: 1422
• Publication Date: 2022-09
• Subjects: risk -- uncertainty -- collective optimism; Small business -- Periodicals; New business enterprises -- Periodicals; Entrepreneurship -- Periodicals; 658.421
• DOI: 10.1177/1042258720985475
• Languages: English
• ISSNs: 1042-2587

Abstract

How small-business owners assess uncertainty and risk in the macroeconomic environment to report optimism toward their business activity is an important research question for policymakers and academics alike. Drawing on a monthly optimism index and a variety of uncertainty and volatility (risk) trackers from January 1986 to June 2017, in line with the expectation that business owners dislike uncertainty in economic policy, economic policy uncertainty may lower optimism. Business investment and sentiment volatility, however, contributed positively to optimism. The findings provide preliminary implications for policymakers in targeting indicators salient to the optimism index of small-business owners.