The Impact of Mandatory IFRS Adoption on Foreign Mutual Fund Ownership: The Role of Comparability

PurposeThe purpose of this paper is to explore how heuristics are formed and whether herding and prospect theory act as antecedents to heuristics. The relationship is explored specifically for millennials.Design/methodology/approachThe proposed relationship is explored specifically for millennials. Herding and prospect theory are modelled as antecedents to heuristics. The study uses survey data from 923 millennials from India to test the model for two financial products: equity and mutual funds. Regression analysis is used to evaluate the model.FindingsFindings support the role of herding and prospect theory as antecedents to heuristics of millennials although to varying degrees for equity and mutual fund investments. The impact of herding on heuristics is likely to be smaller for equity investments as compared to mutual fund investments.Research limitations/implicationsThe findings provide insights into how heuristics are formed for millennials. The findings add to literature by beginning a new line of inquiry on how heuristics are formed. Since the model is tested on a single generation, future research can test the model on other generations. In addition, future research can also add more antecedents to our proposed model.Practical implicationsFindings from this study can provide financial planners and marketers with an understanding of how heuristics are formed for millennials. Financial planners can use these insights while providing financial advice to this generation and marketers can use them to create more relevant outreach.Social implicationsFinancial investments are an important conduit for financial security. By understanding the cognitive processes that influence financial investment decision-making, it is possible for educators to create content appropriately and for financial planners to advise clients accordingly to enable optimal financial decisions that will be wealth-creating.Originality/valueExisting literature primarily treats heuristics, herding and prospect theory as being independent of each other. The authors take a novel approach to model the antecedents to heuristics to be herding and prospect theory. The model is tested on millennials for two financial products: equity and mutual funds.

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Intergroup Threat and Outgroup Attitudes

Social Psychology ◽

10.1027/1864-9335/a000127 ◽

2013 ◽

Vol 44 (5) ◽

pp. 311-319 ◽

Cited By ~ 12

Author(s):

Marco Brambilla ◽

David A. Butz

Keyword(s):

Gay Men ◽

Social Group ◽

Welfare Recipients ◽

Intergroup Attitudes ◽

Social Policies ◽

Intergroup Threat ◽

Economic Threat ◽

The Impact ◽

General Climate

Two studies examined the impact of macrolevel symbolic threat on intergroup attitudes. In Study 1 (N = 71), participants exposed to a macrosymbolic threat (vs. nonsymbolic threat and neutral topic) reported less support toward social policies concerning gay men, an outgroup whose stereotypes implies a threat to values, but not toward welfare recipients, a social group whose stereotypes do not imply a threat to values. Study 2 (N = 78) showed that, whereas macrolevel symbolic threat led to less favorable attitudes toward gay men, macroeconomic threat led to less favorable attitudes toward Asians, an outgroup whose stereotypes imply an economic threat. These findings are discussed in terms of their implications for understanding the role of a general climate of threat in shaping intergroup attitudes.

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