Behavioral Economics and Employee Turnover Intentions – Evidence from the Oil Sector in Azerbaijan

Employee turnover remains a persistent challenge across industries. However, the oil sector, particularly in environmentally and geopolitically sensitive regions, faces unique vulnerabilities. This study explores the relationship between behavioral economics and employee turnover intentions in Azerbaijan’s oil industry. Drawing on principles such as cognitive biases, emotional drivers, social preferences, bounded rationality, and loss aversion, the research investigates how non-monetary factors influence employees' decisions to stay or leave. With rising global awareness of environmental sustainability, many workers, especially younger and environmentally conscious individuals, are shifting their preferences toward organizations with stronger sustainability practices. The oil industry, often criticized for its environmental impact, struggles to meet these evolving expectations. Empirical findings from the Azerbaijani context reveal that factors beyond wages or job security increasingly influence employee decisions. Perceptions of workplace culture, emotional well-being, and alignment with organizational values now play a crucial role in shaping turnover intentions. This research contributes to a deeper understanding of how behavioral economics can inform human resource strategies in high-risk, high-impact industries. By identifying psychological and social motivators behind turnover, the study offers practical insights for policymakers, HR professionals, and business leaders. Aligning organizational practices with behavioral insights can help improve employee retention and build more sustainable and resilient workforces in complex economic environments.