An entrepreneur launches a new venture when the economy is down. A team member speaks up when it’s safer and more comfortable to stay silent. A government pushes through a structural reform despite short‑term political cost.
These are instances in which conviction meets uncertainty. In business studies and economics research, such moments aren’t typically labeled “courage,” but they are visible, present in our frameworks for studying behaviour under uncertainty.
We discuss some of the ways scholars and analysts have tried to capture courage, not as an abstract virtue, but as a pattern that leaves traces in data.
Acting when the odds are unclear: The behavioural view
Behavioural decision theory draws a distinction between risk, where probabilities are known, and ambiguity, where probabilities are unknown. Experiments in decision‑making show that many people prefer options with known odds even when unknown‑odds options may offer equal or greater expected value. This behaviour is known as “ambiguity aversion” (Ellsberg, 1961).
For instance, the Ellsberg paradox demonstrates that decision‑makers will “prefer choices with quantifiable risks over those with unknown, incalculable risks.” This matters for courage, because acting when outcomes are ambiguous requires accepting that probabilities cannot be neatly pinned down.
In effect, what we might call “courage under uncertainty” is visible through measures such as risk or ambiguity‑tolerance, or persistence in tasks where payoff feedback is delayed or noisy.
Researchers have shown that ambiguity aversion persists even when participants are taught the paradox. That is, knowing the phenomenon does not fully eliminate it (Jia et al., 2020).
In short, when one acts despite incomplete information, and when this behaviour is consistent, it becomes possible for analysts to infer a type of behavioural courage.
Taking initiative under uncertainty: The entrepreneurial and organisational view
In the business world, a frequently used construct that aligns with aspects of courage is Entrepreneurial Orientation (EO). According to Lumpkin and Dess (1996), EO is defined as “the processes, practices, and decision‑making activities that lead to new entry as characterized by … a willingness to innovate and take risks, and a tendency to be aggressive toward competitors and proactive relative to marketplace opportunities.”
When a firm chooses to increase R&D investment, launch a product in a weak market, or enter an emerging business line during economic downturn, these are observable choices. They may reflect optimism, strategy, or opportunism – but they also reflect conviction under, or rather despite, uncertainty. Such moves don’t guarantee superior performance, and other elements also matter (Lumpkin & Dess, 1996; Rauch et al., 2009).
Similarly, within organisations, the notion of psychological safety, formalised by Edmondson (1999), addresses the willingness of team members to take interpersonal risks: “a shared belief held by members of a team that the team is safe for interpersonal risk‑taking.”
When employees speak up, challenge norms, suggest alternative paths, even when doing so is uncomfortable, they reveal a dimension of courageous behaviour within organisational settings.
Useful proxies in this domain include: EO survey scores, R&D (or innovation) expenditure during adverse periods, rates of internal voice or dissent, and scales of moral‑courage or speaking‑up behaviour.
Choosing the long game: The policy and institutional view
Beyond individual and firm behaviour, courage can manifest at the level of policies and institutions. Public‑policy and political‑economy research examines why reforms often lag and how institutional credibility shapes decision timing (Rodrik, 1996).
In essence, when a government implements a structural reform under uncertainty or with upfront cost, the act exhibits what may be described as institutional courage.
Analytically, proxies include: the timing of reform implementation (versus delay), fiscal or reform efforts during economic downturns, and commitment to long‑horizon projects (e.g., green transitions) despite short‑term risks.
While the word “courage” rarely appears in technical models, the behaviours captured (decisiveness in uncertainty, cost‑bearing behaviours) somewhat capture the aspects of the human trait we intuitively call courage.
In measurement terms, one is looking for instances where decision‑makers act before certainty is achieved and despite short‑term headwinds.
Limits and caveats
Quantitative variables cannot fully capture courage. The indicators discussed here are proxies, ways to observe patterns of behaviour that resemble acting with conviction under uncertainty.
Context also matters deeply. A rise in R&D spending, for example, might reflect strategic foresight in one firm but desperation or misallocation in another. Such measures can reveal behaviour consistent with courage, yet they cannot definitively label an action as courageous.
Likewise, survey instruments that attempt to quantify moral courage or psychological safety are useful but imperfect, subject to the same validity and reliability challenges as any social science measure.
Closing thought
Viewed through these lenses, courage becomes less of a pure virtue and more of a behavioural pattern: the choice to act when information is incomplete, the willingness to bear short‑term costs for longer‑term impact, and the resolve to proceed despite ambiguity.
The frameworks of economics and business capture these patterns, though under labels such as ambiguity tolerance, entrepreneurial orientation, voice behaviour, or reform timing (in policies).
Recognising this helps us see that behind every graph and every coefficient capturing these patterns, there is a human element: the resolve to move forward when the outcome is uncertain.
Editor-in-chief of Effective Thoughts | Chief Information Officer at SMCSE Solutions (Pvt.) Ltd. | Global UGRAD Alumnus - University of Southern Indiana | Graduate of Economics with Data Science at Information Technology University.
