Managing human resources in dynamic environments to create value: role of HR options

HR options as firm investments in human assets in uncertain environments to create the capability to flexibly respond to future contingent events have been recognised as valuable. However, the black box of causal interlinkages between environmental uncertainties, HR options and firm performance is yet to be explored in strategic HRM literature. Based on the data obtained from 108 IT software firms in India, this study empirically explores these linkages using a multi-level causal model. The results suggest that the use of HR options positively mediates the effects of environmental uncertainties on firm performance. The mediating influences of different types of HR options, used by the firms to manage various types of uncertainties affecting their human assets, on the operational and the financial performance of the firms are found to be different. Implications of findings of the study for managing investments in human assets under uncertainty have been discussed.     

Economics at the FCC, 2016–2017: Auction Designs for Spectrum Repurposing and Universal Service Subsidies

The Federal Communications Commission is responsible for federal regulation in the telecommunications and electronic media sectors, and for management of the nation’s non-federal radio frequency spectrum. During the past year, Commission economists contributed to the agency’s ongoing efforts to use market-based mechanisms—such as auctions—to allocate spectrum and distribute universal service subsidies efficiently. This includes repurposing broadcast television spectrum for more efficient use by wireless service providers through the recently concluded Broadcast Incentive Auction and structuring auction mechanisms to promote efficient allocation of universal service subsidies for the increased build-out of mobile wireless and fixed broadband service in unserved and underserved areas.     

Applying real options theory to HRM: an empirical study of IT software firms in India

Environmental uncertainties can impact the market value of a firm's human assets both positively and negatively, and make return on human assets uncertain over time. However, the strategic human resource management (SHRM) literature has so far focused almost exclusively only on the upside value of human assets of a firm. Real options theory can provide the process heuristics as well as the economic logic for guiding investments in human assets to create sustainable market value for firms operating in uncertain environments. In spite of the growth in popularity of the real options approach, no meaningful progress, however, has been made towards application of this approach to HRM. This study, using data from 108 IT software development firms in India, seeks to address this gap and make three important contributions to the SHRM literature: (1) operationalise the concept of HR options by identifying the HR practices that possess option value; (2) investigate how use of HR options affects firm-level performance; and (3) develop and test a causal model that links the various types of HR options that firms use to exploit uncertainties faced by them with the firm-level operational and financial outcomes. The results support the central hypothesis of the article that use of HR options by firms operating in uncertain environments would have positive impact on their operational and financial performance. Significant differences were observed in the nature of linkages between different types of HR options used to address different types of uncertainties, and the operational and financial performance of the firm.     

Determinants of bribery in international business

Levels of perceived bribe taking in 54 countries in two time periods were analyzed with respect to two independent variables—their level of human development measuring education, wealth, and health (Human Development Index) and the level of economic freedom measuring the extent to which a nation's economy is open to market forces. The results indicate that lower levels of bribe taking are associated with high human development and greater economic freedom. Developed countries that have shown improvements on the two variables over a five‐year period also show a reduction in their perceived levels of bribe taking. © 2004 Wiley Periodicals, Inc.     

Labor Conflict and Foreign Investments: An Analysis of FDI in India

This paper analyzes patterns of foreign direct investment in India. We investigate how labor conflict, credit constraints, and indicators of a state's economic health influence location decisions of foreign firms. We account for the possible endogeneity of labor conflict variables in modeling the location decisions of foreign firms. This is accomplished by using a state‐specific fixed effects framework that captures the presence of unobservables, which may influence investment decisions and labor unrest simultaneously. Results indicate that labor unrest is endogenous across the states of India, and has a strong negative impact on foreign investment.     

How objective and subjective knowledge affect insurance choices

This study investigates the effect of objective knowledge (OK) and subjective knowledge (SK) on real-life insurance choices, a non-trivial, information-rich choice task with no dominant option. Prior research has shown that OK and SK tend to be correlated, but that is not always the case. By using a novel approach to manipulate SK—which could be adapted by salespeople in real-world contexts—we ensured that levels of SK and OK were not always in accord. Clear patterns emerged showing an inverse relationship between SK and OK, and the number of problem-framing (or structuring)-related statements made, number of overall information processing operations performed and the time spent to reach a decision. Most of the extra effort expended by low SK/low OK individuals was spent framing the problem, not executing decision rules such as making attribute comparisons. Those with high OK were also less prone to misunderstanding product information. Whether high or low SK/OK, there were no differences in final choices, suggesting that neither group jumped to a simplifying choice heuristic. Instead, those low in knowledge compensated for this deficiency by taking more time framing the problem and reaching a thoughtful decision, a decision strategy that weakens the effect of branding.     

More hedonic versus less hedonic consumption behaviour in advanced internet bank services

Finnish internet banking can be considered as one of the most advanced in the world. This paper presents an exploratory analysis of the consumer characteristics in this sector. In the context of internet bank services the paper compares and contrasts two sets of consumers: those who prefer a more experiential view of consumption (more hedonic consumers) with those who believe in a less experiential view of consumption (less hedonic consumers). It was found that important differences exist between these two groups of consumers. Specifically, more hedonically orientated consumers place greater value on almost every proposed service dimension than the less hedonic consumers. These more hedonic consumers tend to be younger people, however, with lower education and income level and thus they do not appear to be an appealing target market for banks. In contrast, less hedonic consumers are found to be a more lucrative target market, even though they prefer basic services that concentrate on the core function of internet banking. The results have profound implications for internet bank services. Banks should focus on an improved functional operation of the services on the internet and cater more to the customers who find it effective and efficient.     

Impact of product market competition on real activity manipulation: Moderating role of managerial ability

In this study, we examine whether managerial ability moderates the association between product market competition and real earnings management. Prior literature largely supports the disciplinary effect of competition, suggesting that competition reduces real activity manipulation. We argue that this association is different depending on the level of managerial ability. Based on the reputation hypothesis, we argue that able managers negatively moderate the association between competition and real activity manipulation. Using a sample of US listed companies from 1997 to 2016, we find evidence to support our moderating assertion. A battery of robustness tests validates our original findings.