engleski

Don’t get too emotional: How regulatory focus can condition the influence of top managers’ negative emotions on SME responses to economic crisis

How SMEs cope with economic crises and their aftermaths has been engaging both practitioners and academicians for some time. This study sets to explore how top managers’ negative emotional reactions drive an SME’s strategic responses to the economic crisis initiated by the recent COVID- 19 pandemic. By drawing on the affect-as- information theory, our survey data collected from 155 top managers in SMEs shows that in SMEs led by top managers who experience strong negative emotions, there is a stronger tendency for increased retrenchment and decreased investment response. Through the lens of regulatory focus theory, we additionally show that this relationship is conditioned by top managers’ regulatory foci. In SMEs led by top managers with high prevention and low promotion focus, there is a balanced response, whereas in SMEs led by top managers with strong promotion and weak prevention focus, oscillations in responses are more likely to occur.

affect as information, economic crisis, emotions, regulatory focus, strategic responses

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