Influence of Overconfidence, Illusion of Control, and Availability on Debt Decision Making in Micro, Small, and Medium Enterprises in Klaten Regency

Abstract

This study aims to investigate the impact of of overconfidence, the illusion of control, and the availability heuristic on debt decisions using a sample of 100 Micro, Small, and Medium Enterprises (MSMEs) in Klaten Regency. The results indicate that overconfidence and the illusion of control variables have a significant positive impact on debt decisions. Meanwhile, the availability variable does not affect debt decisions. This study shows that debt decisions among MSMEs in the Klaten Regency are generally relatively incapable of making rational judgments and thus trapped in bias.