Business Commons^™

“He’S A Real Dude”: Tributes To Tom Jones, Paul C. Godfrey, Bradley R. Agle

Faculty Publications

Researchers often fail to honor luminaries in their fields of inquiry, at least while they are still alive. What follows is one such tribute, to Dr. Thomas M. Jones, the Boeing Company endowed professor in business management at the University of Washington’s Foster School of Business. Business & Society represents an appropriate outlet for this tribute, given that Tom was the first editor of the journal when the International Association for Business and Society (IABS) assumed editorial control of the Sage Publications journal in 1993.

Me, My Spouse, And My Avatar: The Relationship Between Marital Satisfaction And Playing Massively Multiplayer Online Role-Playing Games (Mmorpgs), Michelle Ahlstrom, Neil R. Lundberg, Ramon Zabriskie, Dennis Eggett, Gordon B. Lindsay

Faculty Publications

A variety of online support groups exist for “gaming widows” who feel their spousal relationship has been displaced by time spent playing Massively Multiplayer Online Role-Playing Game(s) (MMORPGs). MMORPG research has been presented on youth and adults, however to date, there is no research on married gamers to support or refute the claims of discontented spouses. The purpose of this study was to gain a better understanding of the gaming behaviors of couples who play MMORPGs. The sample included 349 couples. Results indicated lower marital satisfaction related to couples’ MMORPG gaming interactions such as quarrelling about gaming, not retiring to …

The Value Of A Master’S Degree To Recreation Professionals, Camilla J. Hodge, Brian J. Hill, Christian Brinton

Faculty Publications

This study assessed the nature of the relationship between earning advanced degrees and career outcomes such as salary, job satisfaction, social capital, and human capital among professionals in the parks and recreation field. The sample (n = 196) was drawn from parks and recreation agencies located in the United States. Agencies, excluding educational institutions, were identified via an Internet search for parks and recreation agencies in urban areas. Findings indicated there was a positive relationship between earning a master’s degree and salary. Earning a master’s degree, however, was not significantly related to job satisfaction, social capital, or human capital. Furthermore, …

Lease Transaction Structuring, Earnings Management, And Management Credibility, Susan D. Krische, Paula R. Sanders, Steven D. Smith

Faculty Publications

Despite recent regulatory concerns regarding off-balance sheet financing, and concerns about lease accounting in particular, relatively little is known about how financial statement users view lease transaction structuring compared to other forms of earnings management. We examine sell-side financial statement analysts’ views on lease transaction structuring and its impact on their assessments of management credibility. Although operating leases often act as the prototypical example of transaction structuring, survey responses suggest that lease structuring and related voluntary reconciliations do not raise the same concerns for analysts as do other earnings management activities (which lower analysts’ perceptions of management credibility). Our findings …

Has The Regulation Of Pro Forma Reporting In The Us Changed Investors’ Perceptions Of Pro Forma Earnings Disclosures?, Dirk E. Black, Ervin L. Black, Theodore E. Christensen, William G. Heninger

Faculty Publications

We explore whether investors’ perceptions of pro forma earnings numbers have changed following the regulation of pro forma reporting imposed by the Sarbanes-Oxley Act of 2002 (SOX). First, we find that investors appear to pay more attention to pro forma earnings disclosures in the post-SOX period, consistent with the notion that they perceive that regulation generally renders these disclosures more credible. Second, the results indicate that investors discount aggressive pro forma earnings reports in both periods. However, they appear to discount at least some potentially misleading pro forma earnings disclosures more in the post- SOX period. Finally, our results imply …

The Business Rules Approach And Its Effect On Software Testing, Thomas O. Meservy, Chen Zhang, Euntae T. Lee, Jasbir Dhaliwal

Faculty Publications

Codification and testing of business rules in application programs has historically been a challenge in software engineering. Many organizations have adopted the business rules approach to formalize and compartmentalize business rules as a separate component from application code. This article investigates and presents the effects of the business rules approach on testing activities in the software development life cycle at a Fortune 500 corporation. The findings suggest that the business rules approach has the potential to engage testing personnel early in the development process and to improve the efficiency and effectiveness of testing activities.

Understanding Information Systems Continuance For Information-Oriented Mobile Applications, Leida Chen, Thomas O. Meservy, Mark Gillenson

Faculty Publications

Consumers’ use of mobile data applications is expected to rise significantly in the next few years. While user acceptance and adoption of mobile applications have received growing interest from IS researchers, only a paucity of studies have focused on user continuance behaviors in the mobile commerce context. Studying the IS continuance behavior of 147 registered users of an information-oriented mobile application, this research extends the general model of IS continuance to include a number of explanatory antecedents: information quality, system quality, process quality, and hedonic value. The enhanced framework makes a significant contribution to the theory of IS continuance intention, …

Rethinking Sustained Competitive Advantage From Human Capital, Benjamin Campbell, Russell Coff, David Kryscynski

Faculty Publications

The strategy literature often emphasizes firm-specific human capital as a source of competitive advantage based on the assumption that it constrains employee mobility. This paper first identifies three boundary conditions that limit the applicability of this logic. It then offers a more comprehensive framework of human capital-based advantage that explores both demand- and supply-side mobility constraints. The critical insight is that these mobility constraints have more explanatory power than the firm-specificity of human capital.

Investor Information Demand: Evidence From Google Searches Around Earnings Announcements, Michael S. Drake, Darren T. Roulstone, Jacob Thornock

Faculty Publications

The objective of this study is to investigate factors that influence investor information demand around earnings announcements and to provide insights into how variation in information demand impacts the capital market response to earnings. The Internet is one channel through which public information is disseminated to investors and we propose that one way that investors express their demand for public information is via Google searches. We find that abnormal Google search increases about two weeks prior to the earnings announcement, spikes markedly at the announcement, and continues at high levels for a period after the announcement. This finding suggests that …

The Information Content Of Annual Earnings Announcements And Mandatory Adoption Of Ifrs, Wayne R. Landsman, Edward L. Maydew, Jacob Thornock

Faculty Publications

This study examines whether the information content of earnings announcements – abnormal return volatility and abnormal trading volume – increases in countries following mandatory IFRS adoption, and conditions and mechanisms through which increases occur. Findings suggest information content increased in 16 countries that mandated adoption of IFRS relative to 11 that maintained domestic accounting standards, although the effect of mandatory IFRS adoption depends on the strength of legal enforcement in the adopting country. Utilizing a path analysis methodology, we find evidence of three mechanisms through which IFRS adoption increases information content: reducing reporting lag, increasing analyst following, and increasing foreign …

Influences On Active Family Leisure And A Healthy Lifestyle Among Adolescents, Shallie M. Taylor, Peter Ward, Ramon Zabriskie, Brian Hill, Carl Hanson

Faculty Publications

The purpose of this study was to examine how attitude, subjective norm, and perceived behavioral control influence adolescents’ intent to participate in active family leisure within the theory of plan behavior framework. Adolescents (N = 472) completed an online questionnaire about their perceptions and actual participation in active family leisure. Structural equation modeling was used to analyze the data. A post-hoc analysis also considered individual leisure and its role on active family leisure. Attitude, subjective norm, and perceived behavioral control were significant predictors of intent to participate in active family leisure.

Strategy Selection, Surrogation, And Strategic Performance Measurement Systems, Jongwoon Choi, Gary Hecht, William B. Tayler

Faculty Publications

Strategic performance measurement systems operationalize firm strategy with a set of performance measures. A consequence of such alignment is the tendency for managers to lose sight of the strategic construct(s) the measures are intended to represent, and subsequently act as though the measures are the constructs of interest, a phenomenon referred to as surrogation. We investigate how involvement in strategy selection affects managers’ propensity to exhibit surrogation. We predict and find that strategy selection reduces surrogation. Surprisingly, we do not find that engaging in strategy deliberation, a key process underlying strategy selection, reduces surrogation. Thus, managers’ involvement in the actual …

The Availability And Utilization Of 401(K) Loans, John Beshears, James J. Choi, David Laibson, Brigitte C. Madrian

Faculty Publications

We document the loan provisions in 401(k) savings plans and how participants use 401(k) loans. Although only about 22% of savings plan participants who are allowed to borrow from their 401(k) have such a loan at any given point in time, almost half had used a 401(k) loan over a longer, seven-year horizon. The probability of having a loan follows a hump-shaped pattern with respect to age, job tenure, account balance, and salary, but conditional on having a loan, loan size as a fraction of 401(k) balances declines with respect to these variables. Participants are less likely to use loans …

Why Did Financial Institutions Sell Rmbs At Fire Sale Prices During The Financial Crisis?, Craig B. Merrill, Taylor Nadauld, René M. Stulz, Shane M. Sherlund

Faculty Publications

Much attention has been paid to the large decreases in value of non-agency residential mortgage-backed securities (RMBS) during the financial crisis. Many observers have argued that the fall in prices was partly caused by fire sales. We use capital requirements and accounting rules to identify circumstances where financial institutions had incentives to engage in fire sales and then examine whether such sales occurred. For financial institutions subject to credit-sensitive capital requirements, capital requirements increase as an asset’s credit becomes impaired. When accounting rules require such an asset’s value to be marked-to-market and the fair value loss to be recognized in …

Soft Strategic Information And Ipo Underpricing, James C. Brau, James Cicon, Grant Mcqueen

Faculty Publications

Using content analysis we measure the impact of soft information, derived from words in IPO registration documents, on IPO pricing efficiency. First, using 2,298 U.S. IPOs from 1996 to 2008, we find that an IPO document’s strategic tone correlates positively with the stock’s first-day return; more frequent usage of positive and/or less frequent usage of negative strategic words lead to more IPO underpricing. Second, we find that an IPO document’s strategic tone is negatively correlated with the stock’s long-run return. Together, these findings imply that investors initially misprice soft information in registration statements, which mispricing is eventually corrected. Additionally, we …

Inefficient Labor Or Inefficient Capital? Corporate Diversification And Productivity Around The World, Todd Mitton

Faculty Publications

I study the relation between corporate diversification and labor productivity in a sample of over 500,000 firms from 46 countries. Across the entire sample, greater diversification is associated with significantly lower labor productivity. The negative relation between diversification and labor productivity is not stronger in countries with more burdensome employment regulation, but it is significantly stronger in countries with better financial development. In addition, the negative relation is stronger in industries with high capital/labor ratios. Overall, the results suggest that the lower productivity in diversified firms is due more to the misallocation of capital than to the inefficient use of …

Unpacking The Privacy Paradox: Irrational Decision-Making Within The Privacy Calculus, David W. Wilson, Joseph S. Valacich

Faculty Publications

Understanding privacy is important to individuals and organizations. This research in progress develops a theoretical model that incorporates both actual disclosure behavior and the potential for irrational behavior induced by overriding situational factors presented at the time of the privacy disclosure decision. Actual disclosure behavior is seldom measured in privacy research, and most prior work has assumed the disclosure decision to be a fully rational one. This research challenges that assumption, and the eventual completion of the project will contribute uniquely to our understanding of the privacy calculus in online transactions.

Assessing Program Implementation: What It Is, Why It's Important, And How To Do It, Mat D. Duerden, Peter A. Witt

Faculty Publications

While the importance of evaluation program offerings is acknowledge by Extension educators, less emphasis is given to understanding program implementation. Simply assessing program impact without a clear understanding of the degree to which a program was actually implemented can result in inaccurate findings. The effective evaluation of both program impacts and evaluation can provide Extension educators with a more holistic perspective of their programs and an increased ability to identify and disseminate best program practices.

Evaluating Journal Quality And The Association For Information Systems (Ais) Senior Scholars’ Journal Basket Via Bibliometric Measures: Do Expert Journal Assessments Add Value?, Paul Benjamin Lowry, Gregory D. Moody, James Gaskin, Dennis F. Galletta, Sean L. Humpherys, Jordan B. Barlow, David W. Wilson

Faculty Publications

Information systems (IS) journal rankings and ratings help scholars focus their publishing efforts and are widely used surrogates for judging the quality of research. Over the years, numerous approaches have been used to rank IS journals, approaches such as citation metrics, school lists, acceptance rates, and expert assessments. However, the results of these approaches often conflict due to a host of validity concerns. In the current scientometric study, we make significant strides toward correcting for these limitations in the ranking of mainstream IS journals. We compare expert rankings to bibliometric measures such as the ISI Impact Factor™, the h-index, and …

A Re-Examination Of Analysts’ Superiority Over Time-Series Forecasts Of Annual Earnings, Mark T. Bradshaw, Michael S. Drake, James N. Myers, Linda A. Myers

Faculty Publications

We re-examine the widely held belief that analysts‟ earnings per share (EPS) forecasts are superior to random walk (RW) time-series forecasts. We investigate whether analysts‟ annual EPS forecasts are superior, and if so, under what conditions. Simple RW EPS forecasts are more accurate than analysts‟ forecasts over longer horizons, for smaller or younger firms, and when analysts forecast negative or large changes in EPS. We also compare the accuracy of a third forecast of longer-term earnings based on a naïve extrapolation of analysts‟ one-year-ahead forecasts. Surprisingly, this naïve extrapolation provides the most accurate estimate of long-term (two- and three-year-ahead) earnings. …

Antecedents Of Identity Development In A Structured Recreation Setting: A Qualitative Inquiry, Mat D. Duerden, Stacy Taniguchi, Mark Widmer

Faculty Publications

Identity research has focused primarily on outcomes associated with identity formation. Far less attention, however, has been given to understanding the facilitating contextual elements of this process. This qualitative study examined a context, a 2-week adventure recreation program for youth, quantitatively shown in previous research to have promoted identity development. The program took place in Idaho’s Salmon-Challis National Forest and involved rafting, backpacking, mountain biking, and a variety of other outdoor activities. Data were gathered from 23 female and 22 male participants, ages 11 to 15 (M = 13.2, SD = .89). Seven distinct categories emerged from the analysis related …

Workforce Skill Development In Camps, Mat Duerden

Faculty Publications

For many young people, serving as a summer camp staff member can be an entry point into the labor market as well as a valuable job skill-building experience. These camp staff jobs can vary widely by title and expectations but often have one thing in common- the young staff member is often responsible for the safety and well-being of younger children often in their care 24 hours a day for weeks at a time. At a time when employers express concern regarding the workplace readiness of the emerging workforce (Jackson, 2010), camp-based employment, which includes a wide range of positions …

Small-Firm Uniqueness And Signaling Theory, James C. Brau, J. Troy Carpenter

Faculty Publications

The purpose of this paper is two-fold. First, we develop a theory of small firm uniqueness. Instead of using an exogenous definition of firm size typical of the extant literature, we allow firms

Did Securitization Affect The Cost Of Corporate Debt?, Taylor Nadauld, Michael S. Weisbach

Faculty Publications

This paper investigates whether the securitization of corporate bank loan facilities had an impact on the price of corporate debt. Our results suggest that loan facilities that are subsequently securitized are associated with a 17 basis point lower spread than that of facilities that are not subsequently securitized. We consider facility characteristics that are associated with the likelihood of securitization and estimate the extent to which these characteristics are related to spreads. We document that Term Loan B facilities, facilities of B-rated firms, and facilities originated by banks that originate CLOs are securitized more frequently than other facilities. Spreads on …

Measuring Life Skills: Standardizing The Assessment Of Youth Development Indicators, Mat D. Duerden, Peter A. Witt, Mariela Fernandez, Marie Jolliff Bryant, Daniel Theriault

Faculty Publications

While the development of life skills (e.g., communication, problem solving, etc.) is a commonly targeted youth program outcome, the lack of standardized conceptualizations and instrumentation make it difficult to compare impacts across programs and develop validated best practices. In order to promote a more unified approach to life skill development, literature reviews were conducted for 10 life skill domains to identify common definitions and, if available, appropriate outcome measures. Data were then collected from an ethnically diverse sample (N = 758) of elementary, middle, and high school aged youth for the 10 identified instruments. Analyses were conducted to ascertain the …

Subprime Foreclosures And The 2005 Bankruptcy Reform, Donald P. Morgan, Benjamin Iverson, Matthew Botsch

Faculty Publications

After the bankruptcy abuse reform (BAR) took effect in October 2005, foreclosures on subprime mortgages surged nationwide.

Prior to BAR, overly indebted borrowers could file bankruptcy to free up income to pay their mortgage by discharging unsecured debts; BAR eliminated that option for better-off filers through a means test and other requirements, making it more difficult to save one’s home by filing bankruptcy.

A study of the reform suggests that BAR was associated with more subprime foreclosures; BAR’s effects were greater in states with high bankruptcy exemptions, as theory predicts.

For a state with an average home equity exemption, the …

The Impact Of Moral Stress Compared To Other Stressors On Employee Fatigue, Job Satisfaction, And Turnover: An Empirical Investigation, Kristen Bell Detienne, Bradley R. Agle, James C. Phillips, Marc-Charles Ingerson

Faculty Publications

Moral stress is an increasingly significant concept in business ethics and the workplace environment. This study compares the impact of moral stress with other job stressors on three important employee variables—fatigue, job satisfaction, and turnover intentions—by utilizing survey data from 305 customer-contact employees of a financial institution’s call center. Statistical analysis on the interaction of moral stress and the three employee variables was performed while controlling for other types of job stress as well as demographic variables. The results reveal that even after including the control variables in the statistical models, moral stress remains a statistically significant predictor of increased …

Internal Audit Outsourcing And The Risk Of Misleading Or Fraudulent Financial Reporting: Did Sarbanes-Oxley Get It Wrong?, Douglas F. Prawitt, Nathan Y. Sharp, David A. Wood

Faculty Publications

The Sarbanes-Oxley Act of 2002 (SOX) represents a far-reaching legislative attempt to improve the quality of financial reporting in the United States in response to the major accounting frauds of the late 1990s and early 2000s (Klein 2003). A significant change imposed by SOX was to prohibit the outsourcing of internal audit services to firms’ external auditors.1 Competing academic arguments suggest that this ban will either improve or worsen financial reporting quality. The knowledge spillover argument suggests that by both performing the external audit and providing nonaudit services, auditors improve overall audit quality through a deeper understanding of the client …

Publication Benchmarking Data Based On Faculty Promoted At The Top 75 Us Accounting Research Institutions, Steven M. Glover, Douglas F. Prawitt, Scott L. Summers, David A. Wood

Faculty Publications

The primary purpose of this study is to update the Glover et al. (2006) publication benchmarking study by providing benchmarking statistics of faculty promoted to associate and/or full professor from 2004 to 2009. We also extend Glover et al. (2006) by examining new benchmarking metrics and by investigating publication productivity differences between studies. Our results indicate that, on average, faculty promoted from 2004 to 2009 had more publications in leading accounting journals at the time of promotion than faculty promoted from 1995 to 2003. We explore possible explanations for the increase in publication productivity. We find that increases in the …

The Effects Of Preventive And Detective Controls On Employee Performance And Motivation, Margaret H. Christ, Scott A. Emett, Scott L. Summers, David A. Wood

Faculty Publications

We examine how two attributes of preventive and detective controls affect employee performance and employee motivation. Specifically, we examine how the extent to which controls (1) restrict employees’ autonomy, and (2) provide more or less timely feedback impacts employees’ performance and intrinsic motivation. These characteristics are the defining differences between preventive and detective controls in that preventive controls restrict employee autonomy relative to detective controls and preventive controls always provide immediate feedback; whereas, detective controls can provide either immediate feedback or delayed feedback. We conduct an experiment to examine how and why these two types of formal controls impact employees’ …