Modeling of factors affecting investment behavior during the pandemic: a grey-DEMATEL approach

The study intends to examine the cause-and-effect relationship between Covid-19 and the factors affecting investment behavior in a South Asian economy. The investment behavior is considered as an MCDM problem. To address this problem, the study employs MCDM approach i.e., a blend of both DEMATEL and Grey theory due to its potential to deal with subjective judgments of investors. The results indicate that Covid-19 is the leading cause behind financial stress, psychophysiological health outcomes, investors' perception about the market, and investors' strategy. Among sub-factors, portfolio allocation is the most influenced sub-factor. Alteration in portfolio is a major challenge for emerging countries which have become attractive destinations for global investors. Overall, the significant contribution of the paper is to establish the interlinkages among the factors affecting investment behavior, given the uncertainty triggered by the pandemic. Although the literature provides evidence on this problem during normal situations, analysis of investment behavior during severe crisis is still lacking. The research will be immensely useful to different stakeholders such as government, policymakers, financial advisors, and investors in making their strategic or operational decisions.