Less likely to fail: Low performance, firm size, and factory expansion in the shipbuilding industry

摘要

To clarify the effect of performance on risk behavior by identifying the conditions under which performance below the aspiration level leads to risk taking or risk aversion. This research work focuses on risk perception and risk preference in organizational changes. Changes are influenced by the decision makers' evaluation of performance to the aspiration level. The two theories, namely, the behavior theory of the firm and the prospect theory which focus on organizational risk, forms the basis for the research work. The components of the two theories are explained in detail. The data for the research work has been collected from 11 shipbuilding firms. The measures of data, namely, the dependent variables, firm performance, firm size, control variables and models used are explained. The researchers present four hypotheses for the entire study and analyze the same. The conclusions of the work and future research directions are presented.