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2768 items in total found

Working Papers | 2015

Lessons of Reforms of the Telecom Sector

Rekha Jain and G. Raghuram

The telecommunications sector has emerged as one of the key sectors that have put the Indian economy on a revival path. Proactive policies such as opening up the sector to private players and competition, unbundling the policy, regulatory and operational roles of the government, removal of restrictions on foreign investments coupled with viewing reforms as a continuous process created an environment conducive to growth. These reforms enabled induction of new technologies.
In this paper, we examine the lessons of reforms of the Indian telecom sector. We first examine where the sector is in terms of its impact on service provision and to the economy in relation to the past. Then we outline the sector structure examining the role and relationships of different players. Next, we provide the roadmap of reforms carried out over two decades. From this, we abstract the enabling principles that drove the reform process and bring out lessons for other infrastructure sectors.

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Working Papers | 2015

Strategic Responses to Deregulation:
An Institutional Theory Perspective

Sunil Sharma

Firms adopt distinct strategic orientation in response to change in environment. Deregulation is a drastic change in firm's environment. This paper attempts to explain strategic orientation exhibited by firms in response to deregulation from an institutional theory perspective. Integrating propositions have been developed to examine congruence of institutional theory concepts of coercive and mimetic isomorphism with stylized strategic orientation. Unique methodology of corroborating propositions with empirical findings from past studies was adopted. While partial support was found for propositions, the inferences drawn provide alternative explanations for results of empirical studies and for expanding the boundaries and scope of institutional theory.

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Working Papers | 2015

Are Investors Ethics Agnostic?

Saravana Jaikumar, Viswanath Pingali, and Vineet Virmani

In this paper we ask if the perception investors have regarding ethical nature of the management per se influences their action. In order to check for rent seeking behaviour that could arise when there is negative perception regarding ethics, we look a single company's management whose actions-though not related to the performance of the company-have led to doubts regarding its ethical nature. Using event study mechanism, we find that when the action leads to a positive outcome for the company, the investors' reaction is statistically insignificant. However, when another action did not lead to any potential positive outcome, the abnormal returns associated with the company's stock are negative and significant. Therefore, it is possible that unethical practices, even if unrelated to company's performance, lead to lesser trust regarding the company, thereby reducing the stock prices, which suggests rent seeking behaviour.

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Working Papers | 2015

Will you buy if others touch it? Evaluation of products touched by others during shopping

Abhishek

Research on multisensory nature of consumption has highlighted importance of smell, taste, and touch during product evaluation and subsequent purchase decisions. While sensory cues have a role to play in evaluation of products and services, their actual effects gets swayed by presence of other situational contexts which can substantially enhance the ability to explain and understand consumer-behavioural acts. One of the important situational context - social surroundings - has not been examined in detail for studies related to touch. Two previous studies have defined social surrounding in terms of presence/absence of unknown shopper. However, in many situations, the shopping activity is accompanied by family members or friends. Also, presence of salesperson acts as an important constituent of social surroundings. Any analysis of social surrounding is incomplete if it does not look into role of salespersons and known co-shoppers as part of social surroundings which influence shopping process. In this paper, it is proposed that social surrounding, as defined by presence of salespersons and known co-shoppers, has a role to play in haptic evaluation of products.

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Working Papers | 2015

Selective Perceptions and Group Brainstorming: An Investigation of Auditors' Fraud Risk Assessment

Naman Desai and Vishal Gupta

Individuals in an organizational context are routinely faced with complex problems that are not well defined and that challenge their cognitive capacities. To deal with such complex issues, decision-makers construct "belief-structures" which in turn create selective perceptions about information and events that prevent them from being overwhelmed by the amount and complexity of information. This study examines the impact of two important contextual variables; pressures and opportunities on auditors' selective perceptions and fraud risk assessments. Research suggests that a situation relevant concept, norm, perspective, or cognitive process that is shared by a majority of the group members, will be exaggerated in a group setting where groups are trying to accomplish a task that does not have a normatively/demonstrably correct answer. In an audit setting, typically there are no normatively correct answers related to the weighting of different levels of pressures and opportunities while assessing fraud risk. Therefore we also examine how individual auditors' selective perceptions affect group decisions. The results indicate that observed differences in individual auditors fraud risk assessments were significantly accentuated during group brainstorming. Thus, our findings suggest that, group brainstorming instead of reducing the influence of contextual characteristics on selective perception, actually accentuates that effect.

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Working Papers | 2015

The Effects of Fraud Risk Factors and Client Characteristics on Audit Procedures

Naman Desai

There has been very little prior research examining how the prescriptions of SAS No. 99 map into the auditors' fraud risk assessment process. SAS No. 99 asks the auditors to consider two major types of fraud (fraudulent financial reporting (FFR) and misappropriation of assets (MOA)) in the context of three major fraud risk factors (pressures, opportunities and rationalization). In this study we conduct an experiment to gain an understanding about the auditors' perceived responsibility for detecting FFR versus MOA. Then we examine how auditors associate the two fraud risk factors (pressures and opportunities) with the two potential types of frauds mentioned in SAS No.99. Additionally we also examine the extent which the client size of an auditor affects the auditors' perceived responsibility for detecting FFR and MOA and how the auditors associate pressures and opportunities with FFR and MOA. The results indicate that while all auditors focused equally on FFR; auditors of larger clients assessed a significantly lower responsibility for detecting MOA compared to FFR. On the other hand, auditors of smaller clients assumed equal responsibility for detecting FFR versus MOA. The results of this experiment also indicated that auditors of larger clients associated the risk of FFR more with high pressures, and the risk of MOA more with high opportunities, while auditors of smaller clients did not specifically associate the risk of FFR or MOA with either high pressures or high opportunities. Additionally the results suggest that auditors of larger clients assessed higher fraud risk and audit effort when pressure was high compared to when opportunity was high. This could be due to the fact that such auditors perceive greater responsibility for detecting FFR compared to MOA and they tend to associate high pressures with FFR and high opportunities with MOA. For the auditors engaged with smaller clients, there were no differences in the perceived responsibility for detecting FFR versus MOA, nor did they specifically associate FFR and MOA with either pressure or opportunity. As a result of which, there were no significant differences in their assessments of fraud risk and audit effort in the presence of high pressures or high opportunities.

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Working Papers | 2015

Derivatives Pricing using QuantLib: An Introduction

Jayanth R. Varma and Vineet Virmani

Given the complexity of over-the-counter derivatives and structured products, al-
most all of derivatives pricing today is based on numerical methods. While large fi-
nancial institutions typically have their own team of developers who maintain state-
of-the-art financial libraries, till a few years ago none of that sophistication was avail-
able for use in teaching and research. For the last decade„ there is now a reliable
C++ open-source library available called QuantLib. This note introduces QuantLib
for pricing derivatives and documents our experience using QuantLib in our course
on Computational Finance at the Indian Institute of Management Ahmedabad. The
fact that it is also available (and extendable) in Python has allowed us to harness the
power of C++ with the ease of iPython notebooks in the classroom as well as for stu-
dent's projects.

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Working Papers | 2015

Internationalization of Firms from Emerging Economies: An Organizational Learning Framework

Sunil Sharma

Increasing globalization of economy has provided fresh impetus to internationalization efforts of firms from both developed and emerging economies. Extant research in this area has been carried out with the perspective of firms from developed economies. The issue of internationalization efforts by firms from emerging economies has received sparse attention. Further, multiple theories have been applied to examine this subject. Rarely the issue has been seen as multidimensional and as set of decisions that involve tradeoff. This paper attempts to bridge this gap by suggesting an integrative framework to look at internationalization as a multidimensional phenomenon. The framework is grounded in resource based view, organizational learning, and institutional theories. In addition, internationalization effort by a firm has been treated, as a separate decision not related with earlier or concurrent internationalization efforts with its own unique dimensions. This essentially means that internationalization process is highly context specific.

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Working Papers | 2015

Organization Design for Knowledge Transfer in Alliances

Sunil Sharma

With increasing globalization, competitive landscape has undergone tremendous change. To cope up with turbulent environmental demands, firms are entering into alliances to bridge capability gap. However, movement from skill substitution to capability development requires firms to adopt organizational learning approach and to do so require organization reconfiguration. So far, literature has paid little attention to organizational redesign in response to the requirement of learning and developing capabilities. In a Joint venture, three actors are involved; Parent firm with capability, joint venture and parent firm seeking capability. This paper looks at issue of organizational learning and redesign from the perspective of parent firm seeking capabilities. An integrated framework is developed with addresses issue of identification of learning level and maps it with level of interface, control, and process orientation. Based on this framework, appropriate organizational design criteria to accomplish specific learning task processes can be formed for effective and targeted yet stable learning depending on the context.

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Working Papers | 2015

The Effects of Group Brainstorming on the Auditor's Search for Potential Misstatements and Assessment of Fraud Risk in the Presence of Pressures and Opportunities

Naman Desai

This paper examines the effect of SAS No. 99 recommended group brainstorming on the auditor's search for potential material misstatements and assessments of fraud risk in the presence of different levels of pressures and opportunities. We argue that there are potential differences in the auditor's evaluation of pressures and opportunities while searching for potential material misstatements and assessing fraud risk, and these differences could be exaggerated when auditors brainstorm in groups. The results of a 2 x 2 x 2 between-subjects experiment (in which pressures and opportunities were manipulated at high and low levels, and brainstorming occurred individually or in three member audit teams) indicate that auditors found a significantly greater number of potential material misstatements when they observed high pressures and low opportunities compared to when they observed low pressures and high opportunities (even though there was an equal number of potential material misstatements across in all the treatments). Furthermore, this difference was significantly increased when auditors performed group brainstorming. Similarly, auditors' assessments of fraud risk were significantly higher when they observed high pressures and low opportunities as compared to when they observed low pressures and high opportunities. Again, this difference was significantly increased when auditors performed group brainstorming.

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