Business Commons^™

Toward An Understanding Of Year-Over-Year Changes In Municipal Management Discussion And Analysis Disclosures, Kevin Rich, Brent L. Roberts, Joseph Wall, Jean X. Zhang

Accounting Faculty Research and Publications

Using a unique setting in which the standard setter (the Governmental Accounting Standards Board) provides guidance on the content of Management Discussion and Analysis (MD&A) disclosures, we investigate the determinants of content changes in municipal government MD&A. We do so in terms of economic changes, turnover, and regulatory characteristics. We use a sample of 1142 municipal MD&A disclosures from fiscal year 2011 to 2015 to calculate a difference score based on the degree to which municipal MD&As change from the previous year. Our empirical analysis highlights that MD&A content changes vary directly with changes in the unemployment rate, fund balance …

Review Of Before March Madness: The Wars For The Soul Of College Basketball, Paul M. Mcinerny

Management Faculty Research and Publications

No abstract provided.

Linguistic Tone Of Management Discussion And Analysis Disclosures And The Municipal Debt Market, Kevin T. Rich, Brent L. Roberts, Jean X. Zhang

Accounting Faculty Research and Publications

Purpose

As the management discussion and analysis (MD&A) section contains discretionary narrative disclosures regarding a government's yearly financial changes and status, the authors investigate several municipal debt market consequences of linguistic tone within these disclosures.

Design/methodology/approach

The authors textually analyze municipal MD&As with Linguistic Inquiry and Word Count (LIWC) software and develop narrative tone measures based on existing financial-specific dictionaries. Using a final sample of 446 municipal bond issuances from 2012 to 2016, the authors modify the current bond regression models to examine the association between MD&A disclosure tone and future bond interest costs or rating disagreements.

Findings

This study’s …

Identifying And Selecting Effective Graphic Health Warnings To Prevent Perceptual Wearout On Tobacco Packaging And In Advertising, Scot Burton, J. Craig Andrews, Richard G. Netemeyer

Marketing Faculty Research and Publications

Graphic visual health warnings (GHWs) on cigarette packaging are used in more than 120 countries globally. Because there are concerns about the effectiveness of using the same visual warnings over many years due to wearout, a primary issue is how to identify the most effective visual stimuli. Adolescent smokers and nonsmokers provided more than 2000 ratings of different visual warnings. Cluster analysis and follow-up analyses are used to identify a high-performing visual stimuli group from the larger group of GHWs. Subsequent analyses also show that compared to other pictorial stimuli, the high-performing group is perceived as effective in preventing adolescent …

Toward A Doctrine Of Socially Responsible Marketing (Srm): A Macro And Normative-Ethical Perspective, Gene R. Laczniak, Clifford Schultz

Marketing Faculty Research and Publications

In this conceptual article, the authors use a macro-level analysis and normative ethical theory to delineate and to explicate a doctrine of socially responsible marketing (SRM). Applying a theory-in-formation approach, we postulate a literature-informed definition of SRM. We discuss why a macro and normative-ethical rather than a micro and positive-descriptive perspective is essential to justifying the elements of SRM. We explore and explain why the roots of an authentic doctrine of SRM can be discerned from the literatures of marketing history, corporate social responsibility, institutional economics and moral philosophy. In so doing, the mandate to engage in socially responsible marketing …

Corporate Social Responsibility And Information Flow, Gary Chen, Bin Wang, Xiaohong Wang

Finance Faculty Research and Publications

We find that a firm's greater commitment to corporate social responsibility (CSR) increases firm- specific information incorporated into stock prices. We further show that information searches increase around major disclosure events for firms that are more socially responsible, as observed through requests for newly released annual (10-K) filings on EDGAR and company ticker searches on Google around earnings announcements. Using alternative empirical specifications, we establish a robust and positive relation between CSR and stock price informativeness. Our results are consistent with the ethical and reputational view that a commitment to CSR encourages information acquisition and facilitates information flow into stock …

Independent Directors' Dissensions And Firm Value, Wonseok Choi, Monika K. Rabarison, Bin Wang

Finance Faculty Research and Publications

Using a novel dataset of independent directors’ voting activities on items proposed by managers of Korean firms, we investigate whether independent directors’ dissension in board meetings plays an effective role in enhancing firm value through improved corporate governance. Our results indicate that dissension improves firm value. This finding is robust to different measures of firm value and alternative model specifications including subsample, propensity score matching, and instrumental variable analyses. Overall, we contribute to the understanding of the relation between corporate governance and firm value. Specifically, we provide new evidence that the monitoring by independent directors enhances firm value.

What Consumers Actually Know: The Role Of Objective Nutrition Knowledge In Processing Stop Sign And Traffic Light Front-Of-Pack Nutrition Labels, J. Craig Andrews, Richard G. Netemeyer, Scot Burton, Jeremy Kees

Marketing Faculty Research and Publications

Examining the effects of what consumers actually know (i.e., objective knowledge) is an important gap in front-of-pack (FOP) nutrition research. In experiments with over 2,000 primary food shoppers, we examine the moderating impact of objective nutrition knowledge on key FOP nutrition symbols (Stop Sign labels, Traffic-Light labels, and a control) for effects on nutrient perceptions, nutrition use accuracy, disease risk, brand attitudes, and purchase intentions. Results support the effectiveness of the Stop Sign label over the Traffic Light label for key outcome measures, with the Traffic Light label performing better on nutrition use accuracy. Importantly, those with greater objective nutrition …

Option Trading And Reit Returns, George D. Cashman, David M. Harrison, Hainan Sheng

Finance Faculty Research and Publications

This article examines the relation between option trading volume and real estate investment trust (REIT) market performance. Specifically, we find that option volume increases are followed by decreases in returns. Furthermore, the portion of option volume that is orthogonal to REIT characteristics drives the observed return predictability relation, thereby suggesting that the return predictability of option trading is (at least partially) attributable to information-based explanations. Finally, consistent with informed traders favoring option market activities due to short-sale costs and/or constraints, we find option based return predictability is more evident within REITs than non-REITs, even though firms within this industry are …

Rise Up: Understanding Youth Social Entrepreneurs And Their Ecosystems, Melissa G. Bublitz, Lan Nguyen Chaplin, Laura A. Peracchio, Ashley Deutsch Cermin, Mentor Dida, Jennifer Edson Escalas, Meike Eilert, Alexei Gloukhovtsev, Elizabeth G. Miller

Marketing Faculty Research and Publications

This research focuses on youth social entrepreneurs who are leading ventures that address pressing societal problems including climate change, gun reform, and social justice. It answers Journal of Public Policy & Marketing’s call for more research in marketing on social entrepreneurship. Consistent with the mission of Transformative Consumer Research to enhance individual and societal well-being, this research explores how the dynamic ecosystem of youth social entrepreneurs empowers them to rise up to transform people, communities, and the future for the better. The authors partnered with 20 established youth social entrepreneurs who have founded social impact initiatives as well as …

The Role Of Female Directors In The Boardroom: Examining Their Impact On Competitive Dynamics, Kalin Kolev, Margaret Hughes-Morgan, Kathleen Rehbein

Management Faculty Research and Publications

This study contributes simultaneously to research on women board members and competitive dynamics by investigating two unresolved research questions: What is the effect of female directors on the firm’s competitive repertoire? Under what conditions is this effect more pronounced? Leveraging the “Awareness-Motivation-Capability” (AMC) framework, we predict that having women on the board of directors should impact the complexity, heterogeneity, and volume of the firm’s competitive moves. Relying upon a sample of U.S. pharmaceutical firms for the years 2000 to 2017, we find that adding female directors on the board positively affects the complexity and volume of a firm’s competitive moves, …

From Student To Professional: Teaching Professionalism In The Marketing Classroom, Hulda G. Black, Rebecca Dingus, Alexander Milovic

Marketing Faculty Research and Publications

Developing professionalism skills in the classroom is vital to the business college experience as educators strive to ensure preparedness and success of their graduates. Marketers especially need enhanced professionalism training, as their careers involve interactions with many constituents. In this paper, the authors develop a semester-long emphasis on professionalism that introduces the concept, embeds its importance throughout the course with discussion and relevant exercises, and includes a component to monitor and evaluate professional behavior. Assessments at the beginning and end of the semester provide evidence for learning outcomes, both quantitatively and qualitatively, that speak to the effectiveness of its implementation.

Corporate Social Responsibility Reporting Standards Utilization And Influences On Their Adoption, Julie Beckel Nelsen

Dissertations (1934 -)

Many organizations disclose non-financial operations through a formal corporate social responsibility (CSR) or sustainability report assessing how the firm’s actions impact the environment, humanity, society, and economy. These publicly available reports offer detailed data to stakeholders, and they can guide companies to improve operations, reduce costs, and advance sustainability. Yet, no required disclosure or disclosure method exists for U.S.-based firms, and comparison and evaluation of impact without a standard are problematic. Using Minnesota’s Fortune 500 firms as the sample, this study determined the state of reporting CSR using a standard and determine the influences to adopting CSR reporting standards within …

Laudato Si’ – A Macromarketing Manifesto For A Just And Sustainable Environment, Thomas A. Klein, Gene R. Laczniak

Marketing Faculty Research and Publications

This paper posits that Pope Francis’ 2015 encyclical on environmental climate change, Laudato si’ (“Praise be to you, my Lord”), or LS for short, provides a compelling and multi-faceted framework for co-creating a just and sustainable environment. LS includes considerable commentary about how markets and marketing impact the physical and social environment. Additionally, the document provides religion-inspired ethical norms for market conditions, actions, and performance that reflect both (a) the social teachings of the Catholic Church as they have evolved over the past 125 years and, as we will explain, (b) a foundational predicate of macromarketing scholarship – that is, …

Building Toward A Solid Foundation: The Effect Of Thinking Concretely About The Future, Stacie F. Waites, Adam Farmer, Carol L. Esmark Jones

Marketing Faculty Research and Publications

According to construal level theory, consumers tend to think about their future abstractly, making it unclear and inexact. Here, a new approach is developed to help people enhance their future‐oriented outcomes by priming them to think about their future concretely. Two experiments show that priming a concrete mindset about the future leads to enhanced future‐oriented outcomes. Specifically, the studies show that participants discounted current funds in favor of future gains less when they were primed with a concrete mindset. Opportunity cost consideration is shown to be the mechanism driving this effect. Though research suggests that most consumers do not consider …

Securities Litigation And Corporate Tax Avoidance, Matteo P. Arena, Bin Wang, Rong Yang

Finance Faculty Research and Publications

We examine whether litigation risk is systematically related to corporate tax avoidance. We find that the exogeneous reduction in the threat of securities class action litigation due to the 1999 ruling of the Ninth Circuit Court of Appeals effectively increases corporate tax avoidance, which is consistent with the notion that the threat of shareholder litigation plays a disciplinary role in curbing managerial rent extraction from tax avoidance activities. This finding is robust to alternative model specifications including two placebo tests and propensity score matching. We further find that labor union and alternative external governance mechanisms such as analyst coverage and …

Corporate Innovation In A World Of Common Ownership, Cheng-Huei Chiao, Bin Qiu, Bin Wang

Finance Faculty Research and Publications

Purpose

The purpose of this paper is to examine the impact of common ownership on corporate innovation, including innovation input, innovation output and postgrant patents.

Design/methodology/approach

This paper uses the ordinary least square model and the difference-in-differences technique to evaluate the effect of institutional interlocking shareholdings on the life cycle of corporate innovation.

Findings

The results show that common ownership impedes innovation measured by patent grants and citations through reduced R&D expenditures. However, common ownership protects postgrant patents by lowering the likelihood that a co-owned firm gets involved in patent litigation and by accelerating the settlement of lawsuits between co-owned …

Specialization And Institutional Investors’ Performance – Evidence From Publicly Traded Real Estate, Eli Beracha, George D. Cashman, Hilla Skiba

Finance Faculty Research and Publications

We examine the extent to which 50,620 global institutional investors’ specialization in publicly traded real estate securities is related to their investment performance. Consistent with the information advantage theory (Merton Journal of Finance 42, 483–510, 1987; Van Nieuwerburgh and Veldkamp Journal of Finance, 64, 1187–1215, 2009), we show a positive relation between the percentage of the institution’s portfolio invested in real estate securities and the return generated on those securities. Moreover, we present evidence that the institution’s level of active share to real estate securities is positively related to performance. Additionally, we find that the benefits related to …

How To Not Disappear Completely: Using Video-Based Discussions To Enhance Student Social Presence In An Online Course, Alexander Milovic, Rebecca Dingus

Marketing Faculty Research and Publications

This paper proposes a video-based discussion learning exercise to consider in addition to the traditional online discussion board format. While the traditional written interaction between students in an online classroom is beneficial, the mass adoption of video technology, along with limitations associated with online discussion boards, led to the development of a new way to facilitate group communication using video communication technology. Utilizing the theory of social presence, we demonstrate the effectiveness of this video discussion format, allowing students to virtually "get to know" each other and collaborate in an environment that more closely resembles a traditional face-to-face classroom experience. …

Leadership As An Art: An Enduring Concept Framed Within Contemporary Leadership, Johnette (Jay) Caulfield, Felissa K. Lee, Bret A. Richards

Management Faculty Research and Publications

Purpose

The aim of this viewpoint paper is to refine the meaning of “leadership as an art” in the context of wicked (complex) social problems and in the realm of contemporary leadership research and practice.

Design/methodology/approach

In this paper we explore the meaning of “leadership as an art,” a concept often alluded to but rarely defined concretely. The authors examine the concept by comparing artistic and scientific knowledge paradigms, identifying descriptors of the “leadership as art” concept appearing in the literature and illustrating key attributes of the “leadership as art” concept with real-world examples.

Findings

Leadership as an art is …

Because You’Re Worth The Risks: Acts Of Oppositional Courage As Symbolic Messages Of Relational Value To Transgender Employees, Christian Thoroughgood, Katina Sawyer, Jennica R. Webster

Management Faculty Research and Publications

Achieving greater social equity in organizations often depends on majority members taking risks to challenge the status quo on behalf of their colleagues with stigmatized identities. But, how do employees enact courageous behavior in this regard, and what are the social implications of these courageous acts on stigmatized group members who witness them at work? To begin examining these questions, we conducted 4 studies using qualitative and quantitative data collected from 428 transgender employees. Drawing on the core principles of sociometer theory, we argue that these acts of oppositional courage serve an important symbolic function in the eyes of transgender …

Signaling Green: Investigating Signals Of Expertise And Prosocial Orientation To Enhance Consumer Trust, Stacie F. Waites, Jennifer L. Stevens, Tyler Hancock

Marketing Faculty Research and Publications

Prior research has established the positive effect of green marketing on purchase intentions. Less well known is why. Two empirical studies were conducted to investigate trust as an important mediator explaining the relationship between green marketing and purchase intentions. In study one, we successfully replicate prior research, again finding higher purchase intentions for companies that engage in green marketing. Additionally, trust in the company was found to mediate this relationship. Study two then examines the underlying mechanisms of expertise and prosocial orientation on the relationship between green marketing and trust, and then serially to purchase intentions. Demographic boundary conditions of …

The Role Of Top Management Teams In Firm Responses To Performance Shortfalls, Kalin Kolev, Gerry Mcnamara

Management Faculty Research and Publications

Past research rooted in the Behavioral Theory of the Firm has extensively examined the impact of performance feedback on organizational change and risk taking, finding robust effects that performance shortfalls enhance the risk taking of firms. We argue that the strength of this effect is likely to be contingent on the attributes of the firm’s top management team. To enhance our understanding of which firms are more likely to be sensitive to performance cues, we draw on the Upper Echelon Theory to theorize that key structural attributes of the top management team—tenure and gender diversity, size, and pay disparity—affect how …

Determinants And Consequences Of Internal Audit Functions Within Colleges And Universities, Steven Desimone, Kevin Rich

Accounting Faculty Research and Publications

Purpose

The purpose of this paper is to identify factors associated with the presence and use of internal audit functions (IAFs) at US colleges and universities, as well as their relationship with financial reporting quality and federal grant outcomes.

Design/methodology/approach

Using a combination of publicly available and manually collected data, this paper uses a two-stage model to examine both the factors associated with the use of IAFs within US institutions of higher education and the consequences therein.

Findings

Results indicate that institutions with larger enrollments and endowments, those that receive public funding and those that have an audit committee are …

Fight Or Flee: Outside Director Departures Prior To Contested Management Buyout Offers, Matteo P. Arena, Michaël Dewally, Sarah Peck

Finance Faculty Research and Publications

Research Question/Issue: We investigate outside director departures prior to management buyout offers (MBOs). In these transactions, managers have both an information advantage and incentives to make a lowball offer to shareholders. Outside directors can safeguard against managerial self‐dealing by negotiating for the best terms for public shareholders from either management or another bidder. Research Findings/Insights: It is typical that outside directors stay on the board through an MBO offer as MBOs are less likely to have changes in directors—either joining or leaving—relative to a control sample. After controlling for endogeneity as well as firm and director characteristics, we find that …

Reflections About Professor Robert F. Lusch: Friend, Co-Author And Marketing Visionary, Gene Laczniak

Marketing Faculty Research and Publications

This personal commentary offers some brief reflections about the late Professor Robert F. Lusch. These insights are offered by someone who knew him for many decades as a friend, colleague and co-author.

Finding Calm In The Storm: A Daily Investigation Of How Trait Mindfulness Buffers Against Paranoid Cognition And Emotional Exhaustion Following Perceived Discrimination At Work, Christian Thoroughgood, Katina Sawyer, Jennica R. Webster

Management Faculty Research and Publications

Although much is known about the harmful effects of perceived discrimination on employees’ psychological wellbeing, surprisingly few studies have examined why some individuals with stigmatized identities are able to rise above and overcome the effects of prejudicial work events. To address this gap in the literature, we integrate existing theory and research on workplace discrimination, mindfulness, and paranoid cognition to develop and test a dynamic, within-person moderated mediation model that explains why some employees are able to interrupt the process through which perceptions of discrimination lead to emotional exhaustion the next workday. Specifically, an experience sampling study conducted over two …

How Do Firms That Are Changing The World Engage Politically?, Kathleen Rehbein, Ronei Leonel, Frank Den Hond, Frank De Bakker

Management Faculty Research and Publications

The objective of this study is to contribute conceptually and empirically to the discussion about when firms attempt to align their political efforts with their social goals and how this alignment affects their financial performance, an area currently still under-explored. The empirical context for our analysis focuses on companies that have been singled out due to their efforts to emphasize “shared value” defined as integrating competitive and social policies. The specific research questions that we shed light on in this study include: What have been the types of political efforts that these firms singled out in the pursuit of their …

When Time Is Sales: The Impact Of Sales Manager Time Allocation Decisions On Sales Team Performance, Adam Rapp, J. Andrew Petersen, Douglas E. Hughes, Jessica Ogilvie

Marketing Faculty Research and Publications

Sales managers often take on the dual responsibilities of managing a sales team and selling to customers. This practice raises questions about how sales managers' time allocation to managing and selling activities affects sales team performance. Building on qualitative findings, this research first highlights and categorizes activities that are regularly competing for the limited time resources of today's sales managers. Our qualitative results reveal a prevalence of sales managers taking a "hybrid" approach to managing their sales teams by regularly allocating time toward both managing and selling activities. Through a resource allocation lens, we investigate how the time allocation decisions …

Shareholder Coordination And Corporate Innovation, Ani Manakyan Mathers, Bin Wang, Xiaohong Wang

Finance Faculty Research and Publications

We show that greater shareholder coordination, as proxied by the geographic proximity between institutional investors, is positively related to corporate innovation outcomes. This relationship is driven by coordination among dedicated and independent institutions who have strong monitoring incentives and is more pronounced among firms with lower blockholder ownership and greater information asymmetry where there is greater benefit to monitoring. We propose that shareholder coordination promotes corporate innovation through a reduction in managerial agency problems. Overall, our results are consistent with the notion that greater shareholder coordination enables diffuse shareholders to monitor managers more effectively and enhances corporate innovation.