Psychology of Risk in Economic Decision- Making Under Martial Law: Evidence from Ukraine

Abstract

The purpose of the study was to identify the impact of martial law on economic decision-making in the field of business in Ukraine. The aim of the study was to assess the impact of martial law on business decisions, including measuring financial stress levels, risk perception, and financial anxiety. The methodology involved conducting surveys and experiments to understand the impact of risk information on strategic planning, the impact of stress on hiring and firing decisions, the impact of financial stress on pricing, and the impact of uncertainty on investment decisions. This leads to a decrease in the quality of strategic planning and makes it more difficult to focus on important tasks. It was found that organisations with a high level of risk perception usually resort to more conservative approaches. This includes reducing investment and spending on new projects, and frequent pricing adjustments to reduce financial risks. Organisations adapt their strategies to changing economic conditions, which helps to avoid financial losses during periods of high uncertainty.