Abstract
Behavioral finance provides a better understanding and elaborates
how attitude and cognitive errors affect investors as well as
entrepreneurs or other decision makers. The primary objective of this
study is to find those behavioral biases which impact the firm’s
performance and managerial, financial decision-making process
through the mediating role of entrepreneurial innovations. This study
predominantly focused on four biases that entrepreneurs apparently
exhibit in their decisions. The survey questionnaire technique was used
to collect data for research and analysis; data were collected from 109
respondents which include entrepreneurs and managers from nonfinancial firms of Pakistan. SEM-AMOS 21 was used to analyze the
structural model. The finding shows that innovative organizations often
predict the low tendency of overconfidence and usually are risk-averse
in their financial decision. But the current study shows that innovative
organizations can enhance the profitable performance of the firm with
behavioural biases.
Sajjad Ahmad Baig, Muhammad Zia-ur-Rehman, Khalid Jamil, Muhammad Hashim, Nayab Iqbal. (2019) Impact of Behavioral Biases on firm performance: Mediating Role of Entrepreneurial Innovations , Journal of Managerial Sciences, Volume 13, Issue 2.
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