Assessment of the Reasons for the Termination of Company's Operations in a Pandemic 2021

Abstract

The relevance of studying the problem of entrepreneurs leaving their business has increased significantly in recent years due to the fact that under the influence of the consequences of the COVID-19 pandemic, this process has significantly accelerated. Therefore, one of the possible reasons for the termination of entrepreneurial activity starting in 2020 is the negative consequences of the pandemic, along with other possible positive and negative options for leaving the business. The purpose of the study was to assess the opinion of entrepreneurs who have ceased their activities about the reasons for this according to the results of surveys conducted in a number of countries in 2021. The objectives of the study were: formation of a database of initial data reflecting the opinions of retired entrepreneurs about the reasons for this; development of mathematical models describing the distribution of empirical data across different countries; evaluation of the values of indicators characterizing the exit from business for positive reasons, as well as negative reasons related and unrelated to the pandemic. The initial data were the results of a survey of entrepreneurs in 47 countries during the work on the Global Entrepreneurship Monitoring project. An assessment of four indicators characterizing the positive and negative reasons for the termination of their activities by entrepreneurs was carried out. Empirical data modeling based on the development of normal distribution density functions was used to evaluate the indicators. It is proved that the majority (58.1%) of all entrepreneurs who stopped their activities did so for negative reasons, but not related to the COVID-19 pandemic. It is proved that almost a quarter (23.7%) of all entrepreneurs who stopped their business were forced to do so due to the negative consequences of the pandemic. It is shown that only one in six entrepreneurs who stopped their activities had positive reasons for leaving their business in 2021. The obtained results make a significant contribution to the existing knowledge about the reasons for the termination of entrepreneurial activity in modern national economies.