Dynamics of Valence Framework on Adoption Intention of Financial Derivatives in Developing Markets
Abstract
This study examines the intention to adopt financial derivatives by integrating valence-based factors, perceived benefit and perceived risk, while examining the moderating role of perceived complexity. Data were collected from 142 finance and risk directors across financial institutions in Tanzania and model tested using Structural Equation Modelling (SEM). The results reveal that both Perceived Benefit and Perceived Risk significantly influence the intention to adopt financial derivatives. Complexity significantly moderates the relationships. This study contributes theoretically by validating an extended Valence-risk-Benefit framework. It enhances derivative adoption, emphasises the benefits and related risks while cautioning on complexity as a hindrance.
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