Risk Taking in Indian Context

8/17/2019 Risk Taking in Indian Context

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Financial Risk Taking in the

Indian Context

Presentation by: AdeeshMade for HSS 602: Science and Technology in

India



A success frequently, is as robust as the foundation offailures it is built upon



The two pillars of Science:●

Money ● Education



● What is Risk?

- Attribute of an action which has probablegood and bad payoffs● Key words

- Uncertainty- Unpredictability

- Decision Making- Perceied Risk- Reward- !nsurance

● "ypes of Risks

#inancial$%cono&ic' (ealth' )ecurity'"echnological' etc*+ &ay fre,uently oerlap



● Education, is Risky- A stable &atching. for ability s education is anunsoled proble&- !n the &odern ti&e' the &onetary cost of a good.education is ery high as well

- %en with &atching capability to education' the /ob&arkets are ery non-linear' so education doesn0tnecessarily translate to success and$or satisfaction- "he pri&ary assu&ption of risk of educating byparents isn0t guaranteed

to be paid off* "his &eans'an education risk inolesprobability of cascadingfailure

SCIENCE is Risky



● Markets, are Risky- "he i&plicit cost of pushing the frontiers of scienceand technology is enor&ous

- Reward s Penalty● "he &odern econo&y is deeply rooted in dealing with

risk* "his is i&portant because funding &odernscience is deeply rooted in econo&ic interests*

● #re,uently' the greatest driers of innoation are war'profiteering 1or both co&bined2and social causes cha&pioned

by the rich 3415asically' trust is risky2

SCIENCE is Risky



● 6oern&ents7 5est poised to assu&e risk indeeloping and underdeeloped econo&ies' wherethe scientific and econo&ic foundation is still beingbuilt

● Public %ntities 1eg* 5anks27 8ery co&ple9 entities that

can assu&e &ostly deter&inistic risks● Priate !ndiiduals and %ntities as !nestors7 Most

co&&only assu&e risk purely for high profit &arginand shareholder alue &a9i&i:ing

● Priate !ndiiduals and %ntities as non-!nestors7 #ore9a&ple we talked about the parents of a studentwho atte&pts high education

)o who can Assume Risk?



● !ndigenous )cience' Knowledge and )cientific &ethodwas a holistic pro/ect* ;o proper conceptuali:ation ofrisk' risk assess&ent' &anage&ent etc* Risk takingpri&arily associated with trading' e9ploration andprofiteering' &ilitary and con,uest+ not scientific or

technological adance&ent● Pre i&perial s Post i&perial knowledge syste&s

- Dishar&ony between both* Misappropriation by thewestern educated elites. - Post i&perial knowledge chiefly designed by 5ritain

to inculcate repeatability and unifor&ity* ;otconducie to a &odern world beyond the thirdindustrial reolution

● !ndustry dedicated chiefly towards sustenance

Perception of Risk in !ndia



● <learly' high scientific and technological deelop&entre,uires assu&ption of risk* !f the society is riskaerse' co&petition at global scale not possible* !t0san either$or choice

● ;ehruian !ndia followed the socialist principles in the

chase for rapid industriali:ation● <aeat7 ok in initial deelop&ental stages of nation'

not ok for chasing the enelope● Why not ok?

- ;o accountability- Designed for large infrastructure pro/ects- !noles public consent' this is a co&plicated issue- ;ot enough feedback to learn fro& failure

Managing Risk is !&portant



“[...]We built great big things, ade ungodlytechnological ad!ances, e"plored the uni!erse, cured

diseases, and we culti!ated the world#s greatest artistsand the world#s greatest econoy. We reached for the

stars, acted li$e en. We aspired to intelligence, wedidn#t belittle it, it didn#t a$e us feel inferior. Wedidn#t identify oursel!es by who we !oted for in ourlast election, and we didn#t ... we didn't scare so

easy .[...]%

&Will McAoy+ ;ewsroo& 1%pisode 32



● Risk is a double edged sword* !nnoation can andshould be antifragile

● (ow? =earn fro& failures of innoation in financialinstru&entation- Distribution of risk7 %ncourage entrepreneurship

- %&bracing Rapid Application Deelop&ent 1RAD2philosophy in design on innoation itself - >erhauling education syste&s 1)elf =earning')ugata Mitra7 )chool in <loud' etc*2

● )ilicon 8alley cra:e already causing structural

changes in financial risk taking● Urgent need for education of risk assess&ent and

&anage&ent at all leels in all industries

Deelop&ent needs to be Antifragie



“Sadly, 'ndian entrepreneurs are ore ris$ a!erse

than ()s and 'n!estors%& Anony&ous



References● 5inswanger' (ans* Attitudes towards ris$: *"periental

+easureent in ural 'ndia.* A&erican ournal of Agricultural%cono&ics+ 3@B

● 6upta' et* al* 'nstitutional *n!ironent for *ntrepreneurship in

*+*. !nternational %ntrepreneurship Manage&ent ournal+ CB3

● Mitra' )ugata7 )an -ids Teach Thesel!es.

https7$$www*youtube*co&$watch?E9RbFGfflCDB * CBB@● "aleb' ;assi&* Antifragile7 Things That /ain 0ro 1isorder * ;ew

Hork7 Rando& (ouse' CB3C

● ;arlikar' ayant 8* The Scientific *dge: The 'ndian Scientist fro(edic to +odern Ties* ;ew Delhi7 Penguin 5ooks' CBBI* Print*

https://www.youtube.com/watch?v=xRb7_ffl2D0

https://www.youtube.com/watch?v=xRb7_ffl2D0

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Risk Taking in Indian Context