Business Commons^™

High Flying To Tailspin: Otto E. Szekely And His Troubled Aircraft And Engine Company, Geoffrey D. Reynolds

Faculty Publications

Otto E. Szekely and His Troubled Aircraft and Engine Company is an article concering Hungarian native Otto E. Szekely and his short success as a builder of Flying Dutchman aircraft and Szekely aicraft engines in Holland, Michigan, from the 1920s to the 1930s.

Electronic Cash - More Questions Than Answers, Kerry L. Macintosh

Faculty Publications

Remarks presented during a panel dilscussion held at the Association of American Law Schools 2001 Annual Meeting: Section on Law and Computers on the topic of electronic cash.

If It’S Wrong, It’S Wrong; And More Talk Won’T Make It Right, David J. Cherrington, Owen J. Cherrington

Faculty Publications

We find the moral relativism underlying postmodernism quite disturbing when it comes to discussions of truth and honesty. The following experience illustrates the benefit of a clear, universal standard regarding cheating.

Hardball, Politics, And The Nlrb, Michael Ashley Stein

Faculty Publications

No abstract provided.

The Determinants Of Successful Micro-Ipos: An Analysis Of Issues Made Under The Small Corporate Offering Registration (Scor) Procedure, James C. Brau, Jerome S. Osteryoung

Faculty Publications

In this article we extend the existing IPO literature to the case of micro-IPOs by analyzing a sample of Small Corporate Offering Registration (SCOR) documents from the U.S. state ofWashington. Through theory, we identified variables that should impact the probability of success or failure in a SCOR offering and then empirically tested them. Empirical support was found for the relevance of (1) marketing mechanisms and expenses; (2) ownership and governance factors; (3) business life cycle stages; and (4) signaling factors consistent with our theoretical predictions.

The Teenage Mind - Part 1, David J. Cherrington, Owen J. Cherrington

Faculty Publications

When we see teenagers do things that are seriously wrong or illegal we often ask, “Why did they do such a stupid thing?” “What in the world were they thinking?” In fact, teenagers do many stupid things and sometimes it appears they were not really thinking. But when we examine what goes through their minds it is easier to understand why they sometimes act dishonestly. We also learn that the excuses teenagers make for being dishonest are not much different than the rationalizations used by adults.

The Power Of Suggestion: Inertia In 401k Participation And Savings Behavior, Brigitte C. Madrian, Dennis F. Shea

Faculty Publications

In this paper, we analyze the 401(k) savings behavior of employees in a large U.S. corporation before and after an interesting change in the company 401(k) plan. Before the plan change, employees were required to affirmatively elect participation in the 401(k) plan. After the plan change, employees were automatically and immediately enrolled in the 401(k) plan unless they made a negative election to opt out of the plan. Although none of the economic features of the plan changed, this switch to automatic enrollment dramatically changed the savings behavior of employees. We have two key findings. First, 401(k) participation is significantly …

The Bullet Gic As An Example, David F. Babbel, Jeremy Gold, Craig B. Merrill

Faculty Publications

There has been considerable discussion of a variety of issues related to fair value in the actuarial literature, in conferences, and among individuals interested in this topic. Unfortunately, we seem to be failing to communicate due, in part, to inconsistent use of terminology. The goal of this discussion paper is to present a few concepts that we hope will be of use in the broader discussion of fair value of liabilities.

Good Day Sunshine: Stock Returns And The Weather, David Hirshleifer, Tyler Shumway

Faculty Publications

Psychological evidence and casual intuition predict that sunny weather is associated with upbeat mood. This paper examines the relationship between morning sunshine in the city of a country's leading stock exchange and daily market index returns across 26 countries from 1982 to 1997. Sunshine is strongly significantly correlated with stock returns. After controlling for sunshine, rain and snow are unrelated to returns. Substantial use of weatherbased strategies was optimal for a trader with very low transactions costs. However, because these strategies involve frequent trades, fairly modest costs eliminate the gains. These findings are difficult to reconcile with fully rational price …

Do Behavioral Biases Affect Prices?, Joshua D. Coval, Tyler Shumway

Faculty Publications

This paper documents strong evidence of behavioral biases among Chicago Board of Trade proprietary traders and investigates the effect these biases have on prices. Our traders appear highly loss-averse. Traders who experience morning losses are about 16 percent more likely to assume above-average afternoon risk than traders with morning gains. This behavior has important short-term consequences for afternoon prices, as losing traders are prepared to purchase contracts at higher prices and sell contracts at lower prices than those that prevailed previously. However, during the ten minutes that follow these trades, prices revert strongly to their earlier levels. Consistent with these …

An Empirical Examination Of Sba Guaranteed Loans: Rates, Collateral, Agency Costs, And The Time To Obtain The Loan, James C. Brau, Jerome S. Osteryoung

Faculty Publications

We empirically examine a sample of over 350 entrepreneurial firms that successfully receive an SBA guaranteed loan. The first portion of the paper contains descriptive statistics that lend anecdotal evidence concerning the organization type of borrowers, the incidence of collateral, the reasons for choosing the financial institution in which the SBA loan is secured, the main purpose for the SBA loan, and alternative actions that would have been undertaken had the SBA guaranteed loan not been obtained. The second portion of the paper poses theoretical predictions and tests them via multivariate models. Issues that are considered include the number of …

A Review Of Empirical Studies Assessing Ethical Decision Making In Business, Terry W. Loe, Linda K. Ferrell, Phylis Mansfield

Faculty Publications

This article summarizes the multitude of empirical studies that test ethical decision making in business and suggests additional research necessary to further theory in this area. The studies are categorized and related to current theoretical ethical decision making models. The studies are related to awareness, individual and organizational factors, intent, and the role of moral intensity in ethical decision making. Summary tables provide a quick reference for the sample, findings, and publication outlet. This review provides insights for understanding organizational ethical decision constructs, where ethical decision making theory currently stands, and provides insights for future empirical work on organizational ethical …

The Economics Of Electronic Commerce, William L. Goffe

Faculty Publications

No abstract provided.

Can We All Get Along? The Interpersonal Challenge At Work, Clive Muir

Faculty Publications

No abstract provided.

Office Rent Determinants During Market Decline And Recovery, Barrett A. Slade

Faculty Publications

This article empirically examines office rent determinants in distinct periods of a market cycle. The study uses a dataset of office properties located in a large metropolitan area and spanning a six-year period. During this period, office rents experienced a significant decline and recovery. A time-varying parameter rent index identifies three distinct periods of the cycle: decline, trough and recovery. Tests of structural change conclude that market participants value the determinants of office rents differently during the periods. A microexamination of each rent determinant over the periods of the market cycle provides a greater understanding of how rents vary over …

An Empirical Study Of Sample-Selection Bias In Indices Of Commercial Real Estate, Henry J. Munneke, Barrett A. Slade

Faculty Publications

Real estate price indices based solely on samples of sold properties may not accurately represent the population of properties due to potential sample-selection bias. This study addresses this potential for sample-selection bias in the construction of commercial price indices within the context of the Phoenix area of®ce market. The empirical analysis con®rms the presence of sample-selection bias in the estimation of the total price equation. However, within this sample, the price indices generated after correcting for sample-selection bias do not appear signi®cantly different from those that do not consider selectivity bias.

Expected Option Returns, Joshua D. Coval, Tyler Shumway

Faculty Publications

This paper examines expected option returns in the context of mainstream asset pricing theory. Under mild assumptions, expected call returns exceed those of the underlying security and increase with the strike price. Likewise, expected put returns are below the risk-free rate and increase with the strike price. S&P index option returns consistently exhibit these characteristics. Under stronger assumptions, expected option returns vary linearly with option betas. However, zero-beta, at-the-money straddle positions produce average losses of approximately three percent per week. This suggests that some additional factor, such as systematic stochastic volatility, is priced in option returns.

Accreditation And Academic Quality: A Comparison With Healthcare Accreditation, Ramon B. Zabriskie, Bryan P. Mccormick

Faculty Publications

The origins of accreditation in higher education began at the turn of this century, resulting from the rapid growth in number and variety of educational institutions. One of the key concerns of accreditation has been to address quality in educational experiences. Specialized accreditation of higher education programs in recreation, park resources, and leisure services has evolved over the past 20 years; however; concerns can be raised regarding the ability of the current process to adequately measure quality. Comparisons are made with trends identified in the evolution of accreditation in healthcare and their implication to the future of accreditation. Recommendations are …

Predicting Turnover And Retention In Nursing Home Administrators: Management And Policy Implications, Douglas A. Singh, Robert C. Schwab

Faculty Publications

Administrator turnover and its impact on the quality of patient care are important concerns in the nursing home industry. This study evaluates a model to determine which factors, attitudes, and personal characteristics can predict tenure. Responses to a survey from 290 nursing home administrators (NHAs) who furnished data on their previous positions were analyzed using logistic regression methods. The extracted model correlates tenure with the administrator's past patterns of stability, community attachment, organizational commitment, and facility performance. The model is particularly effective (85% accuracy) in flagging NHAs who are likely to depart within their first 3 years of employment. Implications …

Nautical Namesakes Of A.C. Van Raalte, Geoffrey D. Reynolds

Faculty Publications

Maritime Namesakes of A.C. Van Raalte is an article that concerns the history of the great lakes ships that bore his name for over eighty years.

The Impact Of The Packard Commission's Recommendations On Reducing Cost Overruns On Defense Acquisition Contracts, David S. Christensen, David A. Searle, Caisse Vickery

Faculty Publications

Using data from selected acquisition reports, Drezner et al. (1993) show that reform initiatives from 1960 to 1990 did not reduce cost growth on 197 defense programs. The average cost growth on these programs was 20 percent and did not change significantly for 30 years. Using data from the Defense Acquisition Executive Summary data base, we show a similar result. Initiatives based on the recommendations of the Packard Commission did not reduce the average cost overrun percent experienced on 269 completed defense acquisition contracts evaluated over an 8-year period (1988 through 1995). In fact, the cost performance experienced on development …

The Value Of Open Market Repurchases Of Closed-End Fund Shares, Gary E. Porter, Rodney L. Roenfeldt, Neil W. Sicherman

Faculty Publications

The authors illustrate the value to shareholders when closed-end funds repurchase shares at a discount from net asset value. Repurchases increase share price even when there is no asymmetric information concerning the value of the underlying assets and the percentage discount remains unchanged following the repurchase. Expected gains to shareholders are derived from capturing the discount on the assets associated with the shares repurchased. In an analysis of 27 open market repurchase announcements by closed-end funds, the regression coefficient estimate that measures the association between the actual excess return and the expected increase in share price is essentially 1.0.

Top Management International Orientation And Small Business Exporting Performance: The Moderating Roles Of Export Market & Industry Factors, Franz T. Lohrke, Geralyn Mcclure Franklin, Vinay Kothari

Faculty Publications

This study examined the relationship between top management team international orientation and small business export performance. Results generally supported the hypotheses that market and industry factors moderate this relationship. Employing a sample of U.S. small business exporters, the study found that top management team international orientation had a greater positive relationship with export performance for firms exporting to countries culturally different and geographically distant from their home country than those exporting to countries culturally similar and geographically proximate to their home countries. In addition, international orientation had a greater positive relationship with export performance for firms competing in multidomestic industries …

Maritime Namesakes Of A.C. Van Raalte, Geoffrey D. Reynolds

Faculty Publications

Maritime Namesakes of A.C. Van Raalte is an article that concerns the history of the great lakes ships that bore his name for over eighty years.

The Influence Of Product Publicity On Product Sales In A Noncompetitive Environment, Richard A. Heiens

Faculty Publications

In an effort to more fully integrate publicity into the marketing and promotion mix, the present study examines the influence of product-related newspaper, television, and radiopublicity on Lotto sales in the state of Colorado. The results of the present study indicate that in addition to Jackpot size, television publicity has a statistically significant positive impact on Lotto sales, whereas newspaper and radio publicity do not. Consequently, in their efforts to generate favorable publicity, lottery managers should emphasize the dissemination of jackpot size information via the television medium. Moreover, considering the observed 90% duration interval of .8651 weeks for the influence …

Structuring Time And Task In Electronic Brainstorming, Alan R. Dennis, Jay E. Aronson, William G. Heninger, Edward D. Walker Ii

Faculty Publications

There are many ways in which a GSS can beused to support group brainstorming. This paper reports the results of an experiment that manipulated task structure and time structure. Groups electronically brainstormed on intact tasks(where all parts of the task were presented simultaneously) or on partitioned tasks (where three subcategories of the task were presented to thegroups). The time periods in which groups worked were either one 30-minute time period or three 10-minute periods separated by two-minute breaks. Groups in the partitioned task treatment generated 40% more ideas, but there were no time effects. These differences are attributed to the …

Service-Learning And Management Education A Call To Action, Paul C. Godfrey

Faculty Publications

The private sector of United States society (private corporations) currently enjoys the moral authority to set the national agenda. Business schools, because they train future managers, can play a vital role in helping the private sector sustain that moral authority. Specifically, I argue that service-learning pedagogies offer management educators a way to incorporate citizenship skills and moral training into the traditional management curriculum. This article describes the concept of service-learning, reviews the current state of service-learning in management, and argues that service-learning can enhance both the technical capability and moral capability of students. Key issues for faculty members involved in …

Revisiting The Stock Price Impact Of Quality Awards, Gregory L. Adams, Grant Mcqueen, Kristie Seawright

Faculty Publications

In an event study, Hendricks and Singhal [Hendricks KB, Singhal VR. Quality awards and the market value of the firm: an empirical investigation. Management Sci 1996;42:415±36.] find evidence that firms that win quality awards are further rewarded with a stock price increase on the day of the award announcement. We revisit Hendricks and Singhal (1996), extend their research and find four reasons why management, owners and analysts should be cautious about expecting an abnormal return when a firm wins a quality award. First, in our sample of Baldrige Award winners, the evidence of a stock price response on the announcement …

The Delisting Bias In Crsp’S Nasdaq Data And Its Implications For The Size Effect, Tyler Shumway, Vincent A. Warther

Faculty Publications

We investigate the bias in CRSP's Nasdaq data due to missing returns for delisted stocks. We find that the missing returns are large and negative on average, and that delisted stocks experience a substantial decrease in liquidity. We estimate that using a corrected return of −55 percent for missing performance-related delisting returns corrects the bias. We revisit previous work which finds a size effect among Nasdaq stocks. After correcting for the delisting bias, there is no evidence that there ever was a size effect on Nasdaq. Our results are inconsistent with most risk-based explanations of the size effect.

Estimating Tourism's Economic Impact In Nebraska Counties, Brian J. Hill

Faculty Publications

Every community interested in developing tourism to enhance or diversify their economy wants to know how much good tourism can do for them. While tourism is not the answer to every community's economic challenges, it can provide economic benefits in many cases. These economic benefits must then be compared to the social, cultural and environmental changes that tourism might bring in order to judge its acceptability in community economic development efforts.

Politicians, planners and citizens want to know just how important tourism is to their communities. While some economic benefits and costs are very difficult to calculate, total economic impacts …