Feel dragged out: a recovery perspective in the relationship between emotional exhaustion and entrepreneurial exit

Purpose – This study investigates the relationship between emotional exhaustion and entrepreneurial exit, and how two psychological factors—cognitive well-being (CWB) and affective well-being (AWB)—may attenuate this relationship. Design/methodology/approach – Binary logistic regression analysis is applied to a longitudinal sample of 997 self-employed individuals from the German Socio-Economic Panel (GSOEP) across 2012–2013. Findings – Higher emotional exhaustion increases the likelihood of entrepreneurial exit, but higher affective and/or cognitive well-being reduce the likelihood of actual exit behavior. Practical implications – Exit decisions reflect not only firm performance but also psychological factors. Subjective well-being emerges as an essential mechanism promoting entrepreneurs’ overall well-being; entrepreneurs should psychologically distance from work during off-times. Originality/value – This study identifies emotional exhaustion as a psychological precursor of entrepreneurial exit using actual exit events (not intentions) and shows AWB and CWB as recovery processes that mitigate the exhaustion–exit link. Keywords: Entrepreneurial exit, Emotional exhaustion, Affective well-being, Cognitive well-being. Paper type: Research paper.

Subhan Shahid, Yasir Mansoor Kundi