Objectives: The study aims to find out whether past experiences of price risk, demand risk and business uncertainty affect the decisions made by Small Scale Industrialist and Micro Businessman.
Methods/Statistical analysis: Theprimary data was collected by interviewing Small Scale industrialists and Micro Businessmen using questionnaire (Appendix) in NewDelhi (Kamla Nagar, Malkaganj, Pulbangash and Dilli Haat) during last week of September andthefirst week of October 2018. A dice game was also designed and played with the respondents. The responses recorded on the Likert Scale were analysed using percentage calculation and frequency distribution was used for analysis of open-ended questions.
Findings: Analysis of the data revealed that respondents were affected by past experiences of business uncertainty, price risk and demand risk (from least to most). Past experience of uncertainty affected 60 % of the respondents; analysis of responses did not reveal the reason for being affected by business uncertainty. 68% of the respondents were affected by price risk; 82.35% of them cited the inability to cover their cost of production as the main reason that leads them to consider past price risk while making decisions. 80% of the respondents were affected by demand risk; 90% of them considered the past experience of demand risk as a means of identifying changing demand pattern of the consumer as a result considered it while making decisions. Results of the dice game revealed that if respondents made a profit in a risky situation in the past then 90% of them would carry forward the same strategy in future. If it leads to loss; 66.66% of them would look for a different strategy and if it resulted inno profit no loss; 84.4% of them would carry forward the same strategy.
Application/Improvements: There is a lack of study that attempts to find out the factors affecting decision making by producers in India. This study can be useful to find out the rational and irrational factors affecting decision making by producers under risk and uncertainty.