How AI Impacts Entrepreneurs’ Psychology: Self-Efficacy, Technostress, Dependency, and Work Engagement (A Literature Review)
Keywords:
AI, Artificial Intelligence, Gen AI, Entrepreneurship, Psychology
Abstract
The rise of artificial intelligence (AI) presents entrepreneurs with unique yet significant psychological challenges and opportunities that remain underexplored. This literature review examines the impact of AI adoption on entrepreneurs’ psychological well-being, performance, and work engagement, addressing the question: What are the psychological effects of AI adoption on entrepreneurs? It builds on existing psychological theories regarding entrepreneurship and the rise of new technologies,, such as technostress and burnout, while narrowing the focus to the emergent field of AI and its impact on founders. Given that scholars have expressed that negative founder mental health correlates with poor business performance, examining how AI affects the psychological states of entrepreneurs is essential for the flourishing of both individuals and their startups.
Using a narrative synthesis of 39 studies, this paper categorizes findings into four key themes: Self-Efficacy, Mastery, and Confidence; AI Dependency and Automation Bias; Technostress, Burnout, and Anxiety; and Work Engagement. Findings indicate that AI tools can enhance entrepreneurs’ self-efficacy, confidence, and decision-making by lowering barriers to entry and reducing cognitive load (e.g., streamlining tasks and providing data-driven insights), particularly for diverse and underrepresented founders. At the same time, over-reliance on AI fosters dependency, automation bias, and diminished critical thinking, while both under- and over-use of AI correlate with heightened technostress, anxiety, and burnout. The relationship between AI adoption and work engagement appears two-fold: moderate use enhances productivity and focus, while excessive or minimal use undermines satisfaction and resilience. These findings underscore that entrepreneurs’ psychological outcomes depend on how they navigate AI’s capabilities and limitations, highlighting the need for balanced adoption strategies. Future research should examine longitudinal effects, individual differences, and targeted interventions to mitigate adverse outcomes and support founders’ well-being in an AI-driven entrepreneurial landscape.
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References
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Frenkenberg, A., & Hochman, G. (2025). It’s scary to use it, it’s scary to refuse it: The psychological dimensions of AI adoption—Anxiety, motives, and dependency. https://doi.org/10.3390/systems13020082
Giuggioli, G., & Pellegrini, M. M. (2022). Artificial intelligence as an enabler for entrepreneurs: A systematic literature review and an agenda for future research. International Journal of Entrepreneurial Behaviour & Research, 29(4), 816–837. https://doi.org/10.1108/IJEBR-05-2021-0426
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Hartmann, S., Backmann, J., Newman, A., Brykman, K. M., & Pidduck, R. J. (2022). Psychological resilience of entrepreneurs: A review and agenda for future research. Journal of Small Business Management, 60(5), 1041–1065. https://doi.org/10.1080/00472778.2021.2024216
Honecker, F., & Chalmers, D. (2023). How artificial intelligence shapes legitimacy judgment formation. Proceedings—Academy of Management. https://doi.org/10.5465/AMPROC.2023.10181abstract
Judge, T. A., Thoresen, C. J., Bono, J. E., & Patton, G. K. (2001). The job satisfaction–job performance relationship: A qualitative and quantitative review. Psychological Bulletin, 127(3), 376–407.
Kariv, D., Matlay, H., & Fayolle, A. (2019). Introduction: Entrepreneurial trends meet entrepreneurial education. In [Editor Initials]. E. Publishing (Ed.), Edward Elgar Publishing eBooks. Edward Elgar. https://doi.org/10.4337/9781786438232.00006
Kiani, A. (2024). Artificial intelligence in entrepreneurial project management: A review, framework and research agenda. International Journal of Managing Projects in Business. https://doi.org/10.1108/IJMPB-03-2024-0068
Kosmyna, N., Hauptmann, E., Yuan, Y. T., Situ, J., Liao, X. H., Beresnitzky, A. V., … Maes, P. (2025). Your brain on ChatGPT: Accumulation of cognitive debt when using an AI assistant for essay writing task. arXiv. https://doi.org/10.48550/ARXIV.2506.08872
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Kuske, J., Schulz, M., & Schwens, C. (2024). Hybrid entrepreneurship and entrepreneurs’ well?being: The moderating effect of role demands outside entrepreneurship. Entrepreneurship Theory and Practice, 49(3), 750–770. https://doi.org/10.1177/10422587241288108
Li, J., Yang, Y., Zhang, R., & Lee, Y. C. (2024). Overconfident and unconfident AI hinder human–AI collaboration. arXiv. https://doi.org/10.48550/arXiv.2402.07632
Magni, F., Park, J., & Chao, M. (2023). Humans as creativity gatekeepers: Are we biased against AI creativity? Journal of Business and Psychology, 39. https://doi.org/10.1007/s10869-023-09910-x
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Nghiem, X., Mittal, S., & Dhand, S. (2024). Navigating entrepreneurial stress. In Advances in Psychology, Mental Health, and Behavioral Studies (pp. 293–318). Jackson: IGI Global. https://doi.org/10.4018/979-8-3693-3673-1.ch016
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Otis, N. G., Clarke, R. P., Delecourt, S., Holtz, D., & Koning, R. (2023, December 21). The uneven impact of Generative AI on entrepreneurial performance. https://doi.org/10.31219/osf.io/hdjpk
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2026-01-31
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