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3669 items in total found

Journal Articles | 2023

Pandemic panic? Effects of health system capacity on firm confidence during COVID-19

Balagopal Gopalakrishnan, Jamus Jerome Lim, Sanket Mohapatra

We examine whether firms’ business confidence – defined as their perceptions of risk and sentiment associated with the COVID-19 pandemic – is affected by ex ante health system capacity and ex post government responses. Using firm-level data from 53 countries, we find that ex ante proactive measures, such as healthcare spending and the availability of medical staff, favorably impact firms’ confidence. This effect is, however, moderated by the COVID-19 case load. We also find that the ex post reactive measures, such as health and containment actions and the overall quality of the government response, also bolster business confidence. These effects on confidence vary by firm size and the level of development of the economy, but are largely impervious to prior epidemic experience.

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Journal Articles | 2023

Construction of hypothetical scenarios for central counterparty stress tests using vine copula

Aniket Bhanu, Vineet Virmani

Central counterparties carry out stress tests using historical and hypothetical stress scenarios to assess the adequacy of their default management resources. Parametric models for the construction of hypothetical stress scenarios require expert judgment in parameter setting and substantial model assumptions. We propose a nonparametric method for the generation and/or validation of hypothetical stress scenarios using the vine copula. Our method is superior to others because it allows for the modeling of individual marginal distributions of multiple risk factors independent of joint distribution structures as well as capturing nonlinear tail dependence and fat tails. We show that the method can be extended for generating coherent stress scenarios for multiple central counterparties or clearing services, and that the generated scenarios are “extreme but plausible”. Our method is also pragmatic: use of the vine copula makes the method scalable for large numbers of risk factors, and we propose a fast screening algorithm to reduce computational requirements by quickly identifying small numbers of stress scenarios from a large number of simulations.We also demonstrate the plausibility of scenarios generated using the proposed method.

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Journal Articles | 2023

Harvesting the volatility smile in a large emerging market: A dynamic Nelson-Siegel approach

Sudarshan Kumar, Sobhesh Kumar Agarwalla, Jayanth R. Varma, Vineet Virmani

While there is a large literature on modeling volatility smile in options markets, most such studies are eventually focused on the forecasting performance of the model parameters and not on the applicability of the models in a trading environment. Drawing on the analogy of volatility smile like a term structure in the context of interest rates in fixed-income markets, we evaluate the performance of the Dynamic Nelson–Siegel (DNS) approach to modeling the dynamics of volatility smile in a trading environment against competing alternatives. Using model-based mispricing as our sorting criterion, and deploying a trading strategy of going long the options in the upper deciles and going short the options in the lower deciles, we show that dynamic models consistently outperform their static counterparts, with the worst dynamic model outperforming the best static model in terms of the percentage of mean returns from the trading portfolios and the Sharpe ratio. Specifically, we find that the DNS model consistently outperforms all other competing specifications on most of our selected criteria.

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Journal Articles | 2023

Achieving social and economic sustainability through innovations in transformative services: A case of healthcare organizations in an emerging market

Amalesh Sharma, Sourav Bikash Borah, Aitya Christopher Moses

Resource-poor organizations serve a significant portion of emerging markets’ healthcare industries. Such organizations engage in transformative services. However, given emerging markets’ ever-changing dynamics, it is unclear whether transformative services suffice for such organizations to move towards economic and social sustainability. We present two studies undertaken in the context of missionary hospitals in India. Study 1 identifies that hospitals rely on innovations in transformative services, driven by the co-creation of knowledge by various stakeholders, to remain socially and economically sustainable. Study 2 develops and tests hypotheses using data from 183 hospitals, showing that employee voice, community engagement, and diversity of organizational expertise increase innovation in transformative services at a decreasing rate, while resource munificence and commercialization emphasis moderate the antecedents’ effects. Post hoc analyses show that innovation in transformative services positively affect economic and social sustainability, and that awareness creating efforts moderate these relationships. More broadly, innovations in transformative services are critical for emerging markets’ resource-poor organizations’ economic and social sustainability.

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Journal Articles | 2023

A decentralized approach to model national and global food and land use systems

Mosnier, A., Javalera-Rincon, V., Jones, S. K., Andrew, R., Bai, Z., Baker, J., ... & Zerriffi, H.

The achievement of several sustainable development goals and the Paris Climate Agreement depends on rapid progress towards sustainable food and land systems in all countries. We have built a flexible, collaborative modeling framework to foster the development of national pathways by local research teams and their integration up to global scale. Local researchers independently customize national models to explore mid-century pathways of the food and land use system transformation in collaboration with stakeholders. An online platform connects the national models, iteratively balances global exports and imports, and aggregates results to the global level. Our results show that actions toward greater sustainability in countries could sum up to 1 Mha net forest gain per year, 950 Mha net gain in the land where natural processes predominate, and an increased CO2 sink of 3.7 GtCO2e yr−1 over the period 2020–2050 compared to current trends, while average food consumption per capita remains above the adequate food requirements in all countries. We show examples of how the global linkage impacts national results and how different assumptions in national pathways impact global results. This modeling setup acknowledges the broad heterogeneity of socio-ecological contexts and the fact that people who live in these different contexts should be empowered to design the future they want. But it also demonstrates to local decision-makers the interconnectedness of our food and land use system and the urgent need for more collaboration to converge local and global priorities.

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Journal Articles | 2023

Combining profit and purpose: Paradoxical leadership skills and social–business tensions during the formation and sustenance of a social enterprise

K V Gopakumar, Vishal Gupta

Borrowing from paradoxical leadership literature and using the case of a social enterprise formed from a traditional nonprofit, the present study identifies a set of multilevel skills that helped the leader address the two social–business tensions, namely, continuance as a nonprofit and the forming of a social enterprise and the sustenance of a social enterprise and preventing the drift towards a for-profit orientation during the formation of social enterprise and in its sustenance thereafter. The individual-level paradoxical leadership skill of balancing idealism and pragmatism, the organizational-level paradoxical leadership skill of navigating organizing contradictions, and the societal-level skill of gauging societal developments and their organizational implications helped address the two different manifestations of social–business tensions during the formation and sustenance of a social enterprise. Implications for paradoxical leadership, social–business tensions, and social enterprise literature are discussed.

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Journal Articles | 2023

Moving the mountain: Stigma removal, strategic industry, and the Indian civilian nuclear industry

K V Gopakumar, M P Ram Mohan, Kshitij Awasthi

The present study examines stigma removal in the context of strategic industries. Strategic industries are critical from a national interest perspective and may not be able to engage in conventional stigma management strategies, such as concealment, dilution and coopting stakeholders, identified in extant literature. The present in-depth qualitative study of the Indian civilian nuclear energy industry, a strategic industry within the Government of India, identifies two strategies, namely dependency reduction and category repositioning through responsible behaviour, employed in order to eradicate a global level stigma. The study concludes with implications for strategic industries and stigma management literature.

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Journal Articles | 2023

(Dis)empowering the feminine? Spatializing the interlace of gender-class-neoliberal managerialism in a women-only café in India

Rajeshwari Chennangodu, George Kandathil

Using the Lefebvrian triad, we explore spatial organizing of classed-gendered work and working bodies in a cafe space that emerges from urbanized claims of empowering “rural poor women” to become entrepreneurs by employing them in a cafe. Our critical-interpretive ethnography analyses the process of installing a neoliberal-managerial path along which foodwork and working bodies are hierarchized and disciplined, creating spatialized hegemonic gendered positionalities interlaced with elite urban-working class rural binaries. The womanized workers came to embody the binaries and the dialectical contradictions they created, yet performing alternative femininities in the free spaces and times in the cafe.

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Journal Articles | 2023

Some gains are riskier than others: Volatility changes and the disposition effect

Ellapulli V. Vasudevan

I examine whether investors revise their beliefs about a stock's risk due to an increase in the stock's volatility. This revision makes loss-averse investors more willing to sell a riskier stock with a paper gain as the likelihood of having to sell it at a loss later increases. An analysis of a large Finnish dataset on the holdings and trades of individual investors yields empirical support for this prediction: a one standard deviation increase in volatility is associated with an 11% increase in the disposition effect. The effect primarily emerges from investors' increased propensity to sell stocks with small paper gains.

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| 2023

Technology acquisition following inventor exit in the biopharmaceutical industry

Mayank Varshney, Amit Jain

In technological acquisitions, a “focal” firm aiming to appropriate the technological knowledge of another “alter” firm faces information asymmetries in imperfect strategic factor markets. Little is known about whether the mobility of people between the firms may reduce this information asymmetry and contribute to an increased likelihood of an acquisition. To investigate this question, we argue that for an actively acquiring firm, inventor-exit to an alter firm increases the likelihood of acquisition because it helps identify an acquisition target. In addition, since an acquiring firm is more likely to have information about a potential target with more technological capital, inventor-exit is less likely to reduce information asymmetries and to increase chances of an acquisition. Based on an analysis of acquisitions between firms in the period between 1993 and 2010 in the global biopharmaceutical industry, we find support for these arguments. For an active acquirer firm, inventor exit increases the likelihood of acquisition of the alter (hiring) firm by 335% as compared to an acquisition of randomly selected alter firm. Moreover, the positive effect of inventor–exit on the likelihood of acquisition is negatively moderated by the technological capital of the alter firm. A policy implication is to treat non-compete clauses with caution because they may impede the reduction of information asymmetry that follows from inventor-exit and reduce the likelihood of some acquisitions eventually.

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