Legal aspects of multilevel marketing in India: negotiating through murky waters

Babu, R. Rajesh; Anand, Pushkar

doi:10.1007/s40622-015-0105-1

Cited by 6 publications

(8 citation statements)

References 4 publications

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“…Finally, industry associations (DSE 2015;Seldia 2011;WFDSA 2008) and governments 9 have set up buyback policies to ensure that returning inventory is easy and financially sound. However, despite these countermeasures, empirical evidence mounts that at some MLMs the described problem persists (Babu and Anand 2015;Bosley and McKeage 2015;Keep and Vander Nat 2014;Koehn 2001;Taylor 2014). 7,8,10 As the FTC chairwoman concludes in her keynote remarks to the Direct Selling Association Business and Policy Conference in 2016, the MLM industry 'should undertake [more] in order to operate lawfully and prevent consumer harm' (Ramirez 2016, p. 21).…”

Section: Illegal Pyramid Schemesmentioning

confidence: 99%

The Role of the Distributor Network in the Persistence of Legal and Ethical Problems of Multi-level Marketing Companies

Groß

Vriens

2017

J Bus Ethics

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Multi-level marketing companies (MLMs) such as Amway, Herbalife, or Tupperware differ from most other companies. They market their products and services by means of self-employed distributors who typically work from home, sell products to end consumers, and recruit, motivate, and educate new distributors to do the same. Although the industry's growth seems to illustrate the attractiveness of MLMs, the industry has been facing several legal and ethical problems. In this paper, we focus on these problems and argue that an extended MLM model may help us to understand why such problems continue to occur, despite the countermeasures that have been implemented. By explicating how problems relate to a specific but often overlooked characteristic of MLMs, i.e., the socalled distributor network, we provide an extended understanding of (a) MLMs' mode of operation, (b) the sources of their legal and ethical problems, and (c) the reason that currently implemented and suggested countermeasures may not suffice. Moreover, based on our extended understanding of MLMs and their problems, we propose additional countermeasures.

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Section: Illegal Pyramid Schemesmentioning

confidence: 99%

The Role of the Distributor Network in the Persistence of Legal and Ethical Problems of Multi-level Marketing Companies

Groß

Vriens

2017

J Bus Ethics

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“…Scholars like to use direct selling, MLM, and networking marketing interchangeably (Heng & Ng, 2020). In fact, the more appropriate name is direct selling as provided by the World Federation of Direct Selling Association (Babu & Anand, 2015). MLM is a type of direct selling (based on the characteristics of the compensation plan) and thus, it is a subset of direct selling (Kumar & Satsangi, 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

“…While both schemes comprise a similar pyramid structure (Babu & Anand, 2015), they are different in essence (Galasintu et al, 2018). Both schemes are different in many ways.…”

Section: Literature Reviewmentioning

confidence: 99%

Direct Selling a Controversial Business Model: Recent Development and Future Research Agenda

Chong¹

2022

JTMB

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Direct selling is one of the earliestdistribution models that iscurrently used in the modern commercial world. Direct selling started as a business model and subsequently evolve to becoming a global phenomenon. There are extant scholarly efforts on this research theme in recent years. However, an effort to organise the literature on this theme is lacking. This paper aims to provide insights into the recent development and future research opportunities in direct selling. This paper conducts a systematic structured literature review on the scientistic discoveries in the past ten years. Research papers are carefully synthesised, compare, and contrasted to present a state-of-the-art understanding of the research topic. The reviews conducted in this paper were categorised into four different levels, namely industry level, direct selling organisations’ level, distributor level, and consumer level. This scholarly effort makes a significant contribution to the extant literature on direct selling.

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“…Nowadays, pyramid schemes present new characteristics, and the speed of diffusion is gradually accelerated [1][2][3]. The number of people participating in pyramid schemes is growing exponentially, the economic losses caused by pyramid schemes are increasingly serious [4,5]. It also has caused serious damages to the development of network finance and social stability [6,7].…”

Section: Introductionmentioning

confidence: 99%

Spreading Dynamics of SHIPR Pyramid Scheme Model on Scale-Free Networks

Xue

Cheng

et al. 2021

IEEE Access

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Nowadays, pyramid schemes have caused extremely negative effects on people's lives and seriously damaged the social economy. With the rapid development of network and communication technology, people's direct or indirect social interaction is more frequent, which makes the phenomenon of pyramid schemes more serious. Therefore, it is necessary to study transmission mechanisms and transmission rules of pyramid schemes. In order to study the influence of government management and social interaction topology on the spreading of pyramid schemes, a novel SHIPR (susceptible-hesitatorinvolved-punished-resister) pyramid scheme spreading model is proposed on scale-free networks. The spreading dynamics of pyramid schemes are analyzed in detail by mean-field theory. Then, the basic reproduction number R0 and equilibria are got. Theoretical analysis shows that the basic reproduction number R0 has a great correlation with government crackdown intensity for involved individuals, the coverage rate of government anti-pyramid scheme publicity for susceptible individuals and hesitator, and social interaction topology. Furthermore, the local asymptotic stability of fraud-elimination equilibrium is analyzed based on the Routh-Hurwitz criterion, the global asymptotic stability of the fraud-elimination equilibrium is discussed by the Lyapunov function, the global attractivity of fraud-prevailing equilibrium is proved in detail by comparison principle. Finally, numerical simulations verify the theoretical analysis results.INDEX TERMS Pyramid schemes, SHIPR model, government management, global attractivity, scale-free networks.

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Legal aspects of multilevel marketing in India: negotiating through murky waters

Cited by 6 publications

References 4 publications

The Role of the Distributor Network in the Persistence of Legal and Ethical Problems of Multi-level Marketing Companies

The Role of the Distributor Network in the Persistence of Legal and Ethical Problems of Multi-level Marketing Companies

Direct Selling a Controversial Business Model: Recent Development and Future Research Agenda

Spreading Dynamics of SHIPR Pyramid Scheme Model on Scale-Free Networks

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