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Full-Text Articles in Business

Social Movements And Institutional Entrepreneurship As Facilitators Of Technology Transition: The Case Of Free/Open-Source Software, Sanjay Jain, Habib A. Islam, Martin C. Goossen, Anil Nair Jan 2023

Social Movements And Institutional Entrepreneurship As Facilitators Of Technology Transition: The Case Of Free/Open-Source Software, Sanjay Jain, Habib A. Islam, Martin C. Goossen, Anil Nair

Management Faculty Publications

We integrate insights from the literature on social movements and institutional entrepreneurship into the strategic niche management (SNM) and multilevel perspective (MLP) frameworks to understand the emergence of Linux, a free/open-source operating system, in a regime dominated by proprietary operating systems such as Unix and Windows NT. Employing a “microhistories” methodology, we document how actors in the free/open-source movement took steps that enabled an alternate technological niche to form, gain momentum and eventually infiltrate the extant regime. Our account delineates the key role that actors play in shaping the identity of a niche, amplifying its presence, and finally mainstreaming it. …


Mechanisms In Open Innovation: A Review And Synthesis Of The Literature, Ruben H.A.J. Ogink, Martin C. Goossen, A. Georges L. Romme, Henk Akkermans Jan 2023

Mechanisms In Open Innovation: A Review And Synthesis Of The Literature, Ruben H.A.J. Ogink, Martin C. Goossen, A. Georges L. Romme, Henk Akkermans

Management Faculty Publications

A large body of literature explores the role of context, structure, actors, and outcomes of open innovation (OI), yet pays little attention to the mechanisms underlying these relationships. In this review paper, we synthesize the OI literature using a context-mechanism-outcome approach to identify and classify the various mechanisms observed in empirical OI studies. Our findings demonstrate that the OI literature draws on a wide variety of mechanisms originating from the fields of management, sociology, economics, and psychology. The fifteen mechanisms most frequently observed in the literature fall into four categories: governance and policies; environmental dynamics and interactions; knowledge, skills, and …


Instructional Systems Design And The Diffusion And Adoption Of Technology: (Volume 1), Miguel Ramlatchan (Author & Editor), Mark Parsons (Author), Meghan Soldani (Author), Josie Joswick Mendoza (Author), Maria Satre (Author), Brittany Spitz (Author), Jasmine Bundy (Author), Amanda Kline (Author) Nov 2022

Instructional Systems Design And The Diffusion And Adoption Of Technology: (Volume 1), Miguel Ramlatchan (Author & Editor), Mark Parsons (Author), Meghan Soldani (Author), Josie Joswick Mendoza (Author), Maria Satre (Author), Brittany Spitz (Author), Jasmine Bundy (Author), Amanda Kline (Author)

Distance Learning Faculty & Staff Books

Instructional designers, instructional systems designers, and other educational technologists are, by their nature, innovators. These professionals apply and extend the applied science of learning, systems, communication, and instructional design theory to help students learn. Technology in some capacity is used to make the connections between subject matter experts, teachers, instructors, and their learners. It is common for instructional designers to seek new tools, techniques, and innovations for the improvement of learning, access, quality, and student satisfaction. However, the adoption and diffusion of new educational technology and innovation is a complex process that depends on many variables. Understanding these processes and …


Applications Of Blockchain In Business Processes: A Comprehensive Review, Wattana Viriyasitavat, Li Xu, Dusit Niyato, Zhuming Bi, Danupol Hoonsopon Nov 2022

Applications Of Blockchain In Business Processes: A Comprehensive Review, Wattana Viriyasitavat, Li Xu, Dusit Niyato, Zhuming Bi, Danupol Hoonsopon

Information Technology & Decision Sciences Faculty Publications

Blockchain (BC), as an emerging technology, is revolutionizing Business Process Management (BPM) in multiple ways. The main adoption is to serve as a trusted infrastructure to guarantee the trust of collaborations among multiple partners in trustless environments. Especially, BC enables trust of information by using Distributed Ledger Technology (DLT). With the power of smart contracts, BC enforces the obligations of counterparties that transact in a business process (BP) by programming the contracts as transactions. This paper aims to study the state-of-the-art of BC technologies by (1) exploring its applications in BPM with the focus on how BC provides the trust …


The Dynamics Of Entrepreneurial Networking Logics: Evidence From United Kingdom High-Tech Start-Ups, Joanne Jin Zhang, Charles Baden-Fuller, Jing Zhang Oct 2022

The Dynamics Of Entrepreneurial Networking Logics: Evidence From United Kingdom High-Tech Start-Ups, Joanne Jin Zhang, Charles Baden-Fuller, Jing Zhang

Management Faculty Publications

Purpose – This study aims to explore how entrepreneurial firms’ networking logics may change under different types of perceived uncertainty. The arrival of new knowledge from the entrepreneurial firm’s network may alter the perceived technology and market uncertainty that in turn determines how the firm adopts or combines the two opposing logics of causation and effectuation. Focusing on the roles of external advisors recruited by the firms, the study probes the details of the cyclical process and the mechanism through which networking logics are altered.

Design/methodology/approach – In this study the authors conducted a 3-year longitudinal multiple case study of …


Two Essays On The Effects Of Ceo Social Activism, Habib Islam Aug 2022

Two Essays On The Effects Of Ceo Social Activism, Habib Islam

Theses and Dissertations in Business Administration

The first essay theorizes and quantifies the effects of CEO activism on firms’ financial performance. We examine this relationship within the framework of screening theory. We find that CEO social activism generally leads to adverse investor reactions. This negative effect is most prominent when there is interdimensional incongruence in CEO social activism messages. In addition, we find that the negative effect of CEO social activism is moderated by organizational characteristics that resolve incongruence caused by disparate signals.

The second essay seeks to understand how a CEO’s social activism influences corporate social performance. We hypothesize that CEO social activism will have …


Two Essays On The Role Of Empathy In Consumer Response To User-Generated Content, Mohammadali Koorank Beheshti Aug 2022

Two Essays On The Role Of Empathy In Consumer Response To User-Generated Content, Mohammadali Koorank Beheshti

Theses and Dissertations in Business Administration

Empathy is known to be the basis of all human interactions and an essential component of human psychology. Empathy includes a cognitive component (perspective-taking) and an affective component (e.g., emotional contagion). The two essays of my dissertation investigate how each of these components of empathy affect consumer responses to user-generated content.

Essay 1: Although both price and online review ratings are important cues in consumers’ product quality judgment, most previous studies have treated price and review ratings as separate inputs into consumer decision-making. The current research shows that the two cues are intertwined, such that consumers’ perception of the same …


Present At The Creation, A Redux: The Need For Strategic Minded Joint Force Officers In A Rapidly Changing And Dynamic International Security Environment, Thomas Joseph Snukis Aug 2022

Present At The Creation, A Redux: The Need For Strategic Minded Joint Force Officers In A Rapidly Changing And Dynamic International Security Environment, Thomas Joseph Snukis

Graduate Program in International Studies Theses & Dissertations

The US Joint Force has an outstanding record over its history of superb performance at the tactical level of war. Inarguably, the United States is currently the best tactical Joint Force in the world a product of a world class tactical education, training, and development program generating and sustaining that tactical proficiency at the individual and organizational level. While tactical education and training programs have been extremely successful, the Professional Military Education (PME) responsible for developing strategic mastery has not been as highly rated. Over the past seventy-five years numerous indictments have been levied against the US PME enterprise, and …


Two’S A Crowd? Implications Of Economic Geography For Corporate Governance, Matthew Farrell Aug 2022

Two’S A Crowd? Implications Of Economic Geography For Corporate Governance, Matthew Farrell

Theses and Dissertations in Business Administration

Although literature on corporate governance and economic geography often explores similar constructs, theories, and other matters, little work has been done examining their joint effects. This two-essay dissertation integrates these literatures in order to partially fill this gap by asking the following research questions:

1.) Do geographic proximity and multiple directorships function as substitutes or complements?

2.) How is the governance of highly innovative firms affected by the presence of Marshallian externalities?

While some scholars suggest that multiple directorships lead to board members neglecting their advisory and monitoring obligations, others have embraced the idea that holding multiple board seats can …


Three Essays On Stock Price Informativeness, Stock Price Momentum, And Firm Investment Efficiency, Chen Chen Aug 2022

Three Essays On Stock Price Informativeness, Stock Price Momentum, And Firm Investment Efficiency, Chen Chen

Theses and Dissertations in Business Administration

Scholarly studies documented that stock price informativeness plays a critical role in market efficiency. In this dissertation, we participate this stream of literature by investigating the effects of stock price informativeness on the magnitudes of stock price momentum and the outcomes of corporate merger and acquisition decisions.

Essay 1 explores the effect of stock price synchronicity on momentum. The momentum anomaly is widely attributed to investor cognitive biases, but the trigger of cognitive biases is largely unexplored. In this study, inspired by psychology studies linking cognitive biases to the noisiness of information, we examine whether momentum returns are associated with …


Human Resource Officer's Perspectives On Recruitment And Hiring Practices Of Diverse Candidates, Tara Kelton Mcdaniel Aug 2022

Human Resource Officer's Perspectives On Recruitment And Hiring Practices Of Diverse Candidates, Tara Kelton Mcdaniel

Educational Foundations & Leadership Theses & Dissertations

A wealth of research supports the positive impact minority teachers have on all students, but especially minority students. Benefits include an increase in academic achievement, an increase in educational engagement, and an overall sense of self-efficacy and autonomy. Unfortunately minority teachers and teachers of color are significantly underrepresented in the United States teaching workforce compared to their White counterparts. Challenges for diversifying the teaching workforce include historical factors of racism and suppression, the Whiteness of educator preparation programs as the prevailing ideology, and the presence of toxic work environment conditions during field placements and employment. While many historical and contemporary …


Smart Manufacturing—Theories, Methods, And Applications, Zhuming Bi, Lida Xu, Puren Ouyang Aug 2022

Smart Manufacturing—Theories, Methods, And Applications, Zhuming Bi, Lida Xu, Puren Ouyang

Information Technology & Decision Sciences Faculty Publications

(First paragraph) Smart manufacturing (SM) distinguishes itself from other system paradigms by introducing ‘smartness’ as a measure to a manufacturing system; however, researchers in different domains have different expectations of system smartness from their own perspectives. In this Special Issue (SI), SM refers to a system paradigm where digital technologies are deployed to enhance system smartness by (1) empowering physical resources in production, (2) utilizing virtual and dynamic assets over the internet to expand system capabilities, (3) supporting data-driven decision making at all domains and levels of businesses, or (4) reconfiguring systems to adapt changes and uncertainties in dynamic environments. …


Acquisition Career Progression Model For Navy Explosive Ordnance Disposal Officers, Andrew John Heckel Aug 2022

Acquisition Career Progression Model For Navy Explosive Ordnance Disposal Officers, Andrew John Heckel

Engineering Management & Systems Engineering Theses & Dissertations

The United States Navy Explosive Ordnance Disposal (EOD) officer community does not have a dedicated career progression model that is focused on progressively building an acquisition knowledge base which makes it more difficult to be a successful program manager and to promote as an operational leader. This thesis outlines a career progression model that is designed as an acquisition knowledge management strategy for Navy EOD officers. The model utilizes the existing billets manned by Navy EOD officers to gain the knowledge and experience required to attain Acquisition Professional Membership within the Department of Defense. Most importantly, the model is used …


Instructional Designers Conducting Professional Learning Using Social Media: A Phenomenological Study Of Their Experiences Through A Self-Regulated Learning Lens, Pauline S. Muljana Aug 2022

Instructional Designers Conducting Professional Learning Using Social Media: A Phenomenological Study Of Their Experiences Through A Self-Regulated Learning Lens, Pauline S. Muljana

STEMPS Theses & Dissertations

Because the instructional design and technology field is dynamic (Sharif & Cho, 2015; Wang et al., 2021), instructional designers need to pursue continuous, just-in-time professional learning (Carliner, 2018) to improve knowledge, skills, and abilities (Sharif & Cho, 2015; Ritzhaupt & Martin, 2015), without being constrained by location, budget, and time (Muljana et al., 2020; Muljana et al., 2021). On the one hand, the omnipresent social media technologies offer affordances for facilitating this type of professional learning. Such technologies allow instructional designers to reach out to colleagues, search for ready-to-implement strategies, and find relevant, timely information. On the other hand, conducting …


What Is The Meaning In This? Teachers' Propensity To Search For Meaning In Life During Covid-19 And The Role Of Meaningful Work, Seterra D. Burleson Aug 2022

What Is The Meaning In This? Teachers' Propensity To Search For Meaning In Life During Covid-19 And The Role Of Meaningful Work, Seterra D. Burleson

Psychology Theses & Dissertations

The global COVID-19 pandemic has presented notable challenges in teachers’ career paths. In the present study, Super’s life-span, life-space theory was applied to examine the interplay between K-12 teachers’ propensity to search for meaning in life and meaningfulness attributed to their work role (i.e., meaningful work) in predicting career-relevant outcomes in the face of challenging circumstances over the course of a semester. A model was proposed in which propensity to search for meaning in life led to better work and career outcomes, an effect moderated by meaningful work. Longitudinal data from a sample of 617 teachers over eight outcome measurement …


Predictors Of Email Response: Determinants Of The Intention Of Not Following Security Recommendations, Miguel Angel Toro-Jarrin Aug 2022

Predictors Of Email Response: Determinants Of The Intention Of Not Following Security Recommendations, Miguel Angel Toro-Jarrin

Engineering Management & Systems Engineering Theses & Dissertations

Organizations and government leaders are concerned about cyber incidents. For some time, researchers have studied what motivates people to act in ways that put the confidentiality, integrity, and availability of information in organizations at risk. Still, several areas remained unexplored, including the role of employees’ evaluation of the organizational systems and the role of value orientation at work as precursors of secure and insecure actions in relation to information technologies (information security [IS] action). The objective of this research project was to examine how the evaluations of formal and informal security norms are associated with the intention to follow them …


Between The Public And The Private Interest: The Interrelationship Of Intermediary Roles Of Environmental Nonprofits In Coastal Resilience, Marina Saitgalina, Juita-Elena (Wie) Yusuf, Taiwo Olanrewaju-Lasisi Jul 2022

Between The Public And The Private Interest: The Interrelationship Of Intermediary Roles Of Environmental Nonprofits In Coastal Resilience, Marina Saitgalina, Juita-Elena (Wie) Yusuf, Taiwo Olanrewaju-Lasisi

School of Public Service Faculty Publications

Government regulators cannot mitigate the loss of wetlands and coastal erosion alone. Nonprofits, uniquely situated between coastal property owners with personal interests and governments with regulatory interests, are positioned to mediate the interests of different parties while considering local context and individual circumstances. However, it is unclear what roles environmental nonprofits play within the network of actors. This study asks: (1) What roles do environmental nonprofit organizations play in local stakeholder network arrangements for wetlands conservation and shoreline management? (2) How are these roles interrelated? We use two frameworks describing the roles of nonprofits to examine the roles of environmental …


Electrical Equipment Industry Cluster, Pragati Gautam Jul 2022

Electrical Equipment Industry Cluster, Pragati Gautam

2022 REYES Proceedings

The growing collaboration between two or more industries in a specific region in which they work in a symbiotic relationship, providing benefits to each other and contributing in the overall development of the region, is what is popularly known as business clusters. Even though this concept is commonly known and implemented in the West, South Asian economies are unfamiliar with the advantages of this unique business strategy. There are, undeniably, many potential business clusters in these developing countries, which if tapped efficiently, could result into an industrial boom.

This research focuses on investigating the existence of a business cluster in …


Three Essays On Ceo Traits, Corporate Investment Decisions, And Firm Value, Rongyao Zhang May 2022

Three Essays On Ceo Traits, Corporate Investment Decisions, And Firm Value, Rongyao Zhang

Theses and Dissertations in Business Administration

More and more research has shown that the characteristics of top executives, especially CEOs, affect organizational decisions and behaviors. This dissertation primarily focuses on the role of executives’ managerial ability played in firm investment decisions, such as mergers and acquisitions (M&As) and corporate social responsibility (CSR) investment, and firm value.

Essay 1 examines whether high-ability managers’ earnings smoothing is motivated by the need to mitigate the adverse effects of heightened information asymmetry triggered by M&As on managers’ reputation capital and firm value. I document that acquirers with high-ability managers engage in more pre-acquisition earnings smoothing and experience more significant announcement …


Two Essays On Antecedents And Effects Of Award-Winning Ceos, Veronika Ciarleglio May 2022

Two Essays On Antecedents And Effects Of Award-Winning Ceos, Veronika Ciarleglio

Theses and Dissertations in Business Administration

A vibrant stream of research in strategic management examines CEO reputation, status, media coverage, and awards on firm outcomes.

This dissertation examines antecedents that impact the likelihood of CEOs gaining higher visible status —such as winning awards — and the impact of such status on firm behavior. The dissertation addresses these issues in two essays.

In the first essay, we use signaling theory to frame the impact of industry characteristics, firm level strategic initiatives, and demographic factors on the likelihood of CEOs winning awards. Specifically, in this essay we examine how industry structure, corporate social responsibility (CSR) initiatives, business strategies, …


Pedestrian Evacuation: Vulnerable Group Member Influence On The Group Leaders’ Decision-Making And The Impact On Evacuation Time, Terra Lynne Elzie May 2022

Pedestrian Evacuation: Vulnerable Group Member Influence On The Group Leaders’ Decision-Making And The Impact On Evacuation Time, Terra Lynne Elzie

Computational Modeling & Simulation Engineering Theses & Dissertations

As pedestrian evacuations of buildings, outdoor venues, and special events occur, dynamic interactions between pedestrians and vehicles during egress are possible. To model pedestrian and vehicle evacuations, simulation models have evolved to incorporate more realistic crowd characteristics and behaviors to provide improved results. Past studies using modeling and simulation, specifically agent-based modeling, have explored pedestrian behaviors such as decision-making, navigation within a virtual environment, group formations, intra-group interactions, inter-group dynamics, crowd behaviors such as queuing and herding, and pedestrianvehicle interactions. These studies have led to relevant insights helpful to improving the accuracy of evacuation times for normal and emergency egress …


Complex System Governance Leadership, David C. Walters May 2022

Complex System Governance Leadership, David C. Walters

Engineering Management & Systems Engineering Theses & Dissertations

The purpose of this research was to develop a systems theory-based framework for leadership in governance of complex systems. Recognizing complexity and uncertainty as norms for the environments in which organizations exist encouraged researchers to suggest complexity theory, complex systems, and complex adaptive systems as appropriate for addressing these conditions. Complex System Governance (CSG), based in systems theory, management cybernetics, and governance, endeavors to provide for the design, execution and evolution of functions that provide control, communication, coordination, and integration at the metasystem level to support operations and continued system existence (viability). From a management cybernetics perspective, CSG leadership has …


Risk-And-Resiliency-Intelligent Supply Chain (Rrisc), Ahmad A. Abdelnabi, Ahmed M. Abdelmagid, Ghaith Rabadi, Andres Sousa-Poza, C. Ariel Pinto Apr 2022

Risk-And-Resiliency-Intelligent Supply Chain (Rrisc), Ahmad A. Abdelnabi, Ahmed M. Abdelmagid, Ghaith Rabadi, Andres Sousa-Poza, C. Ariel Pinto

Modeling, Simulation and Visualization Student Capstone Conference

This work proposes a risk-and-resiliency-intelligent supply chain (RRiSC) tool which is an SC risk management framework that leverages cutting-edge technologies in Artificial Intelligence (AI), Big Data Analytics (BDA), and Digital Twins (DT) to develop specific capabilities for SC risk management. RRiSC is a convergence of mature tools and techniques embedded in three modules: Modeling, Simulation, and Visualization – all together integrate the optimization, simulation, and data analytics to test the performance of the whole supply network under different scenarios through measuring the vital KPIs, identifying the vulnerabilities, and setting proactive plans to diminish risks consequences.


A Discussion On Supplier Selection Modeling Approaches, Sheida Etemadidavan, Andrew J. Collins Apr 2022

A Discussion On Supplier Selection Modeling Approaches, Sheida Etemadidavan, Andrew J. Collins

Modeling, Simulation and Visualization Student Capstone Conference

Supplier selection is a subfield of supply chain management that involves multiple steps in order for decision-makers to find suitable suppliers. Supplier selection is important as it could influence the whole company positively or negatively. It has, recently, become a topic of interest because of the recent pandemic and its effect on the global supply chain, which causes supply shortages. As such, the focus of this paper is on characteristics of decision-making modeling approaches, specifically agent-based modeling and multi-agent systems, in supplier selection, as its modeling has always been a challenge for companies due to its complex nature.


An Importance-Performance Analysis Of Local And Destination Visitors To Monocacy National Battlefield, Mckenzie Mosher, Colin Mccormack, Caleb Scruggs, Chris Zajchowski, Jessica Fefer Mar 2022

An Importance-Performance Analysis Of Local And Destination Visitors To Monocacy National Battlefield, Mckenzie Mosher, Colin Mccormack, Caleb Scruggs, Chris Zajchowski, Jessica Fefer

Undergraduate Research Symposium

The purpose of this study was to understand the evolving visitor experience at Monocacy National Battlefield (MONO) in Fredrick, Maryland and, specifically, the way this National Park Service site serves both its’ destination and local visitors. Using an Importance-Performance Analysis, segmented by visitors’ county of residence, we demonstrate key differences in the visitor experience across visitor type. Following survey design with MONO managers and approval from the U.S. Office of Management and Budget, onsite sampling occurred over 21 visitor contact days, stratified by day of the week and time of day, in summer and fall of 2021. 469 visitors were …


Development Of A Framework To Support Informed Shipbuilding Based On Supply Chain Disruptions, Katherine Smith, Rafael Diaz, Yuzhong Shen Jan 2022

Development Of A Framework To Support Informed Shipbuilding Based On Supply Chain Disruptions, Katherine Smith, Rafael Diaz, Yuzhong Shen

VMASC Publications

In addition to stresses induced by the Covid-19 pandemic, supply chains worldwide have been growing more complex while facing a continuous onslaught of disruptions. This paper presents an analysis and extension of a graph based model for modeling and simulating the effects of such disruptions. The graph based model combines a Bayesian network approach for simulating risks with a network dependency analysis approach for simulating the propagation of disruptions through the network over time. The initial analysis provides evidence supporting extension to for using a multi-layered approach allowing for the inclusion of cyclic features in supply chain models. Initial results …


Comparisons And Contrasts Of It Systems And Socioeconomic Status In School Districts, Hannah A. Ross Jan 2022

Comparisons And Contrasts Of It Systems And Socioeconomic Status In School Districts, Hannah A. Ross

OUR Journal: ODU Undergraduate Research Journal

In a technology thrived society, one would think that anyone can have access to technology – especially in schools. However, it is not always the case due to budgets and other factors. As technology becomes an essential part of the workforce, students need to know certain web applications that companies use. This study will compare four school districts within the Tidewater area of Virginia. The following school districts include Hampton City Schools, Newport News Public Schools, York County School Division, and Williamsburg-James City County Public Schools. Each school will be compared and contrasted by the technology applications that are used …


Are Ceos To Blame For Corporate Failure? Evidence From Chapter 11 Filings, Rajib Chowdhury, John A. Doukas Jan 2022

Are Ceos To Blame For Corporate Failure? Evidence From Chapter 11 Filings, Rajib Chowdhury, John A. Doukas

Finance Faculty Publications

This study examines whether chief executive officers (CEOs) are to blame for corporate failures. Using alternative CEO managerial ability measures, we document that high-ability (low-ability) CEOs are less (more) likely to be associated with bankruptcy. We also find that reorganized firms run by high-ability incumbent CEOs experience improved financial performance after filing for Chapter 11. Firms that hire high-ability CEOs with bankruptcy experience also realize improved financial performance. Our evidence indicates that the likelihood of corporate bankruptcy is unrelated to the presence of high-ability managers and that bankruptcy does not adversely affect the post-bankruptcy careers of high-ability CEOs.


The Portfolio Advantages Of Sukuk: Dynamic Correlations Between Bonds And Sukuk, Abdullah Alfalah, Simon Stevenson, Eamonn D'Arcy Jan 2022

The Portfolio Advantages Of Sukuk: Dynamic Correlations Between Bonds And Sukuk, Abdullah Alfalah, Simon Stevenson, Eamonn D'Arcy

Finance Faculty Publications

The growth of the Islamic finance sector has been well-documented. One of the most booming sectors has been Sukuk. According to several past studies, non-Islamic investors' interest in Sukuk is due, at least in part, to the diversification benefits that Sukuk provides in the context of a fixed-income portfolio. This paper compares a pair between Sukuk and Bonds in the Malaysian market issued by the same issuer to have an unbiased comparison. Using unconditional correlation methodology provides an initial examination of the relationship between the matched pairs. In addition, this paper adopts the standard GARCH-DCC approach of Engle (2002). This …


Syndicated Lending, Competition And Relative Performance Evaluation, Thomas Schneider, Philip Strahan, Jun Yang Jan 2022

Syndicated Lending, Competition And Relative Performance Evaluation, Thomas Schneider, Philip Strahan, Jun Yang

Finance Faculty Publications

Relative performance evaluation (RPE) intensifies competitive pressure by tying executive compensation to the profits of rivals. We show that these contracts make loan syndication harder by reducing banks’ willingness to participate in loans underwritten by banks named in their RPE contracts. Lead arranger banks which are more frequently named in RPE hold larger shares of the loans they syndicate, and their borrowers face higher spreads. These banks, in turn, lose market share to banks less likely to be named in RPE. Our results highlight the tension between the normal benefits of competition versus the need for cooperation in loan syndication.