Business Commons^™

From Grain To Glass To Covid 19, Angie Bidlack, Jenny Fisher, Lascelles Hussey, Alyssa Rudner, Jane Siegler

Scholarship and Professional Work - Business

The case examines the business operations of Midwest Whiskey, MWW, focusing on the downstream supply chain. This includes examining the risks, efficiencies, and modes of distribution for all of the MWW products, before and during the COVID-19 Pandemic. Questions of interest include: Considering the downstream supply chain for MWW, where would you suggest Casey invest in the B2B and B2C Channels? Would your answer change had the pandemic not occurred? What risks does MWW have? Why did you choose each? What capabilities, and subsequent actions, can MWW use to mitigate these? What are positives and negatives to investing in a …

Ambiguity Aversion And Experiential Learning: Implications For Long-Term Savings Decisions, Bryan Foltice, Rachel Rogers

Scholarship and Professional Work - Business

This paper evaluates potential methods for reducing ambiguity surrounding returns on equity to improve long-term savings decisions. We evaluate 221 undergraduate students in the U.S. and first assess the degree of ambiguity aversion exhibited by individuals in the sample population as they decide between a risky (known probability) option and ambiguous (unknown probability) option pertaining to their chances of winning $0 or $1 in a hypothetical lottery. Allowing participants to experience the underlying probability through sampling significantly influences behavior, as participants were more likely to select the ambiguous option after sampling. Similarly, we test whether sampling historical return data through …

Research Framework Of Human Factors Interactions With Technical And Security Factors In Cloud Computing, Hongjiang Xu, Sakthi Mahenthiran

Scholarship and Professional Work - Business

There are many advantages to adopt cloud computing, however, some important issues need to be addressed, such as cybersecurity, cost-saving, trust, implementation complexity, and cloud provider’s reliability. This study developed a research framework to study the human factors that interact with technical and cybersecurity factors to affect the cloud-computing provider’s performance from the user’s perspective. Research hypotheses were developed and a survey was conducted to test the hypotheses and validate the research framework.

The Effect Of Board Links, Audit Partner Tenure, And Related Party Transactions On Misstatements: Evidence From Chile, Sakthi Mahenthiran, Berta Silva Palavecinos, Hanns De La Fuente-Mella

Scholarship and Professional Work - Business

Companies restate when material misstatements are identified in previously issued financial statements. Misstatement research in Latin America is sparse, even though they are an important context to study this phenomenon. Chile’s corporate governance regulations are considered exemplars for Latin American countries but its auditing profession is not well developed. Thus, Chile provides an interesting context to study the complementary roles of audit and board governance affecting misstatements. Using a sample of 104 Chilean listed firms over seven years, our study finds that the board links and audit partner tenure negatively affect misstatements. Specifically, given the prevalence of related party transactions …

Understanding The Effects Of Colleague Participation And Public Cause Proximity On Employee Volunteering Intentions: The Moderating Role Of Power Distance, Jundong Hou, Ling Qian, Chi Zhang

Scholarship and Professional Work - Business

Many organizations encourage their employees to participate in charitable activities as part of their corporate social responsibility strategies. As a result, there has been an increased research interest in employee volunteering behavior. However, while previous research on employee volunteering decisions has focused on both individual-level and organizational-level factors, there has been less focus on peer involvement and volunteer cause proximity. To go some way to filling this research area, this paper conducted two studies to examine the possible effects of colleague participation, colleague position and public cause proximity on employee volunteering intentions. Study 1 found that colleague participation and public …

Stock Market Contagion During The Global Financial Crises: Evidence From The Chilean Stock Market, Sakthi Mahenthiran, Tom Gjerde, Berta Silva

Scholarship and Professional Work - Business

The study examines evidence for the transmission of the US and EU financial crises via investor holdings into the Chilean stock market following two global financial crises, in 2008 and 2011. The study modified the models of Bekaert et al. (2014), and Dungey and Gajurel (2015) on the 2007–2009 global financial crisis and extends the period to include the European debt crisis of 2010–2011. The study produced three main contributions. First, changes in the equity holdings of retail investors were a key source of contagion following the 2008 US financial crisis. Second, investor herding during the 2011 financial crisis is …

Assigning Triaged Patients To Treatment Rooms In A Hospital Emergency Department, Barry E. King E. King, Tyler Pollard, Jennifer Rice, Jane Siegler

Scholarship and Professional Work - Business

The assigning of new arrivals at a hospital emergency department to treatment rooms was examined. New patients are summarily triaged and assigned to a treatment room based on severity of their symptoms, the grade of a treatment room, and an exponential benefit curve that encourages the solver to schedule the most severe cases early. SAS’s OPTMODEL modeling language was employed to build the model and SAS’s MILP solver was used to perform the scheduling. Up to thirty patients were optimally assigned to depict the example of a large emergency department.

Using Machine Learning To Predict Sales Conditional On Bid Acceptance, Barry E. King, Jason Davidson

Scholarship and Professional Work - Business

A North American provider of vehicle parking solutions seeks to predict if a bid will be successful and, for those that are successful, what will be the cumulative sales revenue. Both traditional statistical methods and machine learning algorithms were employed. The machine learning techniques performed better than the statistical methods. There is no statistically significant difference between random forest and extreme gradient boosting for either the binary classification task or the regression task.

The Impact Of State Fiscal Policy On States' Resilience Entering The Great Recession, Kathy A. Paulson Gjerde, Peter Prescott, Jennifer Rice

Scholarship and Professional Work - Business

The U.S. economy entered the Great Recession in December 2007 and exited in June 2009. This national statistic obscures a wealth of state-level data shedding light on the policies and conditions that helped some states withstand that recessionary shock for a time. In this study, we used that state-level data in a parametric regression model, known as survival analysis, to estimate the effects that a state’s fiscal policy had on the timing of its entry into the Great Recession. Consistent with earlier, more general, studies focusing on economic growth, we found that taxes have the potential to hasten the start …

Go Global Or Stay Local? Understanding How Fiscal Incentives Reshape Supply Networks, Ricardo Silveira Martins, Janaina Siegler, Armando Souza-Junior, Barbara Flynn, Guilherme Silveira Martins

Scholarship and Professional Work - Business

This study investigates the way firms reconfigure their supply base and reshape their production network to capture value from Free Trade Zone incentives to capture value from incentives. Six production networks located in Manaus, Brazil are analyzed using the Global Production Network framework and factors related to plant type and supplier relationships. A multiple case study was conducted. Data was collected using in-depth semi-structured interviews administered in loco, and the selected the firms were leaders in three different industries: transportation, mechanical assembly and chemicals. The results indicate that, if effectively applied, incentives can impact production network configuration from an embeddedness …

The Influences Of Locus Of Control, Debt, And Framing On Retirement Contributions, Bryan Foltice, Patrick Ilcin

Scholarship and Professional Work - Business

This study evaluates locus of control, debt, and framing effects as potential drivers of retirement savings decisions. We administer an online survey analyzing how much an individual will save for retirement upon graduating college. The study finds that individuals with an external locus of control contribute significantly less to their retirement savings than individuals with an internal locus of control. Interestingly, this study finds no significant relationship between debt overhang and initial contributions. To measure framing effects, participants were given the choice to change their initial contribution rate after seeing the estimated increased future amount of their account balance based …

Prenatal Stress And Birth Weight: Evidence From The Egyptian Revolution, Ronia A. Hawash

Scholarship and Professional Work - Business

The Egyptian Revolution that ignited in January 2011 resulted in intense violent conflict between protestors and former regime allies. This generated a significant amount of fear and stress among people who lived in proximity to such events. We use this exogenous shock as a natural experiment to test the causal relationship between prenatal stress and birth weight. Governorate-level fatalities resulting from this conflict will be used as an exogenous indicator for prenatal stress. Using fixed effects and difference-in-difference analysis, results show that higher prenatal stress resulting from political conflict during the first and second trimesters of pregnancy has a …

Building Country-Specific Advantages (Csa): Understanding How Ftz Incentives Impact Strategic Plant Location And Buyer-Supplier Relationships, Armando Araújo Souza-Júnior, Ricardo Silveira Martins, Jane Siegler, Afrânio A. F. Soares-Filho

Scholarship and Professional Work - Business

We explore how leading companies manage relationships in supply chains that are not formed by natural market forces. Rather, they were stimulated by exogenous forces, such as the Free Trade Zones that are created by the Government’s policy initiatives for purposes of regional development. We researched electronic industry in Manaus, located in the Brazilian Amazon Rain Forest. Multi-methods using qualitative, structured interviews, and quantitative approaches, structural modeling equation, were used. Results indicated that the companies settled for a location that they would not do under normal conditions and, secondly, that there was an expectation of externality as the makers of …

Misperception Of Exponential Growth: Are People Aware Of Their Errors?, Henning Cordes, Bryan Foltice, Thomas Langer

Scholarship and Professional Work - Business

Previous research shows that individuals make systematic errors when judging exponential growth, which has harmful effects for their financial well-being. This study analyzes in how far individuals are aware of their errors and how these errors are shaped by arithmetic and conceptual problems. While arithmetic problems could be overcome by employing computational assistance like a pocket calculator, this is not the case for conceptual problems, a term we use to subsume other error drivers like a general misunderstanding of exponential growth or overwhelming task complexity. In an incentivized experiment, we find that participants strongly overestimate the accuracy of their intuitive …

Challenges And Opportunities For The Development Of River Logistics As A Sustainable Alternative: A Systematic Review, Ademar Vilarinho, Lara Bartocci Liboni, Jane Siegler

Scholarship and Professional Work - Business

In the last decades there has been great concern about sustainability, especially in companies, where the concept of sustainable development is no longer a trend, but a reality. In the logistics field it should not be any different, since it´s importance to the movement of goods and people. This movement is carried out by four transportation modals, road, air, rail and river. The road transportation is widely used in relation to the others, bringing some problems in large urban centers like traffic jams, climate change, pollution, high CO2 emissions, among others. Thus, it is currently a great challenge to make …

Additional Evidence On The Impact Of The International Financial Reporting Standards On Earnings Quality: Evidence From Latin America, Mauricio Melgarejo

Scholarship and Professional Work - Business

The purpose of this paper is to explore whether the adoption of the International Financial Reporting Standards (IFRS) has an impact on the quality of earnings in Latin America. Studying a sample offirms from Argentina, Brazil, Chile, Mexico, and Peru, I find that management reports a lower level of discretionary accruals after the implementation of the IFRS. In addition, this study provides evidence that earnings are more persistent and stock prices are more associated with earning numbers after the application of IFRS. This paper provides evidence that earnings quality has increased after the adoption of IFRS in Latin America.

Perceptions Of Personal Risk In Tourists’ Destination Choices: Nature Tours In Mexico, Gregory E. Osland, Robert Mackoy, Marleen Mccormick

Scholarship and Professional Work - Business

Terrorism, pandemic diseases, and other threatening events have recently heightened the sense of personal risk for tourists considering international travel. This article addresses the paucity of research assessing perceptions of risk both before and during travel to risky destinations. Tourists on two nature tours in Mexico were interviewed and observed while engaged in the travel. Many types of specific perceived risks were uncovered, including insect-borne disease, traffic accidents, financial losses, and unattained goals. Some correlates of perceived risk were tour company reputation, stage of family life cycle, age, and motivation. Based on the types of perceived risk and the factors, …

The “Indy Way”: Lessons From Brazilian Sugarcane Ethanol And Indycar Partnership, Christian Santiago, Jane Siegler, Marcelo Martins Sa

Scholarship and Professional Work - Business

This paper explores how the Brazilian sugar-energetic processors used Indycar racing to increase exports to the United States and create value by transforming the Brazilian ethanol from a commodity fuel to an advanced biofuel, between 2009 to 2012. This case study uses the relationship between Brazilian Sugar-cane Industry Association (UNICA), Brazilian Trade and Investment Promotion Agency (APEX-Brazil), and the IndyCar Racing League (IRL), to show the ability to learn and perform in a competitive scenario. Absorptive Capacity (ACAP) theory is used to understand how the Brazilian sugar-energetic processors identified, assimilated, transformed, and exploited knowledge from this relationship, as well as …

Effectuation, Not Being Pragmatic Or Process Theorizing, Remains Ineffectual: Responding To The Commentaries, Richard J. Arend, Hessam Sarooghi, Andrew C. Burkemper

Scholarship and Professional Work - Business

We appreciate the opportunity to respond to the provocative Dialogue pieces of Read, Sarasvathy, Dew, and Wiltbank (2016; henceforth, “RSDW”); Reuber, Fischer, and Coviello (2016; henceforth, “RFC”); Gupta, Chiles, and McMullen (2016; henceforth, “GCM”); and Garud and Gehman (2016; henceforth, “GG”), each of which makes several claims in defense of effectuation, as well as describes several ways forward in entrepreneurship- and process-related theorizing. We respond in a manner consistent with the traditional perspective in management theorizing that “good theory is practical” (Lewin, 1945), where “theory is theory” (Simon, 1967; Van de Ven, 1989) based on our discipline’s collective commitment to …

In Equations We Trust? Formula Learning Effects On The Exponential Growth Bias, Bryan Foltice, Thomas Langer

Scholarship and Professional Work - Business

This paper evaluates the possible benefits and drawbacks of the formal formula learning of compound growth as it pertains to eliminating, or at least reducing, the exponential growth bias in various household savings and debt decisions. In our main experimental study, we determine if the ability to calculate the simple compound savings formula only assists in its direct area of application with an available calculator, or if this knowledge extends into similar exponentially-based savings and debt decisions when either a calculator is prohibited or when the formula is unknown. In the process of tackling this research question, we develop a …

Cultural Influnces On Risk Tolerance And Portfolio Creation, Mark K. Pyles, Yongping Li, Shifang Wu, Steven D. Dolvin

Scholarship and Professional Work - Business

We extend existing research that examines the impact of culture on risk tolerance. Using surveys completed by Chinese and American students, we find, consistent with previous studies, that Chinese students perceive themselves as more risk tolerant. However, we find that Chinese students are less consistent in matching their perceived tolerance levels with actual scores from a standard risk tolerance assessment. Further, we also examine mock portfolios created by the respondents and find no evidence that Chinese students create portfolios that are riskier than their American counterparts. Our findings suggest that differences in risk tolerance are at least partially a product …

Pomegranate Juice Can Do That? Navigating The Jurisdictional Landscape Of Food Health Claim Regulation In A Post-Pom Wonderful World, Hilary G. Buttrick, Courtney Droms Hatch

Scholarship and Professional Work - Business

Thirty years ago, the most the consumer expected out of his or her morning glass of juice was a little extra vitamin C. By 2010, the consumer expected a lot more. POM Wonderful’s pomegranate juice, for instance, promised to improve cardiovascular health, treat erectile dysfunction, and combat prostate cancer.¹ Those claims made orange juice look a little pathetic. Of course, those wild promises also landed POM Wonderful in hot water with the Federal Trade Commission (“FTC”) for misleading the public with scientifically unsubstantiated health claims.²

Banco Solidario S.A.: The Recovery Strategy, 2000–2004, Karina Caballero, Mauricio A. Melgarejo, Enrique Ogliastri

Scholarship and Professional Work - Business

Five years passed since, in April, 2000, Kurt Koenigsfest took over as the Chief Executive Officer at Banco Solidario S.A. (BancoSol), in La Paz, Bolivia. BancoSol had become the top Latin American bank specializing in providing microbusiness services. Since its beginning in 1992, BancoSol achieved excellent results and became an international reference in the microcredit area. In mid-2000, external and internal factors caused its performance to deteriorate. Kurt and his management team set and implemented a strategy that led the bank to be rated as the best financial institution in the Bolivian financial system in 2004. The time had come …

Taca, Pedro Raventos, Mauricio A. Melgarejo

Scholarship and Professional Work - Business

The airline industry is energy intensive, has high fixed costs and its demand is very sensitive to the economic cycle. After the industry worldwide undergoes deregulation, starting with the United States in 1978, two distinct business models develop. Traditional carriers operate hub and spoke networks, offer onboard service and engage in price discrimination, whereas low cost carriers operate point to point, charge for all services and have simple tariffs. TACA begins operations in Central America in 1931 and, by 1943, has a footprint that extends from the United States to Argentina. In 1998–2001 TACA faces increased competition and a significant …

Effectuation As Ineffectual? Applying The 3e Theory-Assessment Framework To A Proposed New Theory Of Entrepreneurship, Richard J. Arend, Hessam Sarooghi, Andrew C. Burkemper

Scholarship and Professional Work - Business

Effectuation is a proposed new theory of entrepreneurship, with insufficient empirical testing and critical analysis. Drawing on a new, comprehensive set of theory-building criteria—sourced from and complementing those of Robert Dubin and others—we provide the first formal assessment of effectuation as a theory. We highlight its strengths and weaknesses, leveraging the former to address the latter in five different directions that would build on the existing work to improve this theory. The assessment exercise also displays the value of our assessment framework in guiding the evaluation and development of other existing and future theories in entrepreneurship and management.

Exponential Growth Bias Matters: Evidence And Implications For Financial Decision Making Of College Students In The U.S.A., Bryan Foltice, Thomas Langer

Scholarship and Professional Work - Business

This paper tests the exponential growth bias of undergraduate students at a top-level university in the United States and explores the potential drivers of this bias. We find that bias matters, even for college students, in making savings and debt decisions. In this sample, we observe that the individuals who have already taken on debt are more biased, while those who have experience with savings products are less biased. Moreover, those classified as possessing an awareness of compound growth as well as an ability to consistently calculate the compound savings equation are significantly less biased in different savings treatments than …

How To Decrease The Amortization Bias: Experience Vs. Rules, Bryan Foltice

Scholarship and Professional Work - Business

We conduct an experimental study that tests the effectiveness of de-biasing a certain form of exponential growth bias found in household finance debt decisions, called the amortization bias. We provide 251 bachelor students at a German university with a short tutorial based on one of three learning methods: experiential learning, learning a simple “I Owe More” debt rule-of-thumb, as well as learning an extended, but more accurate version of the “I Owe More” debt rule. Immediately after completing these tutorials, we retest for the amortization bias and find a significant bias improvement in all three treatments. More importantly, after confronting …

Curtain Call Executive Services, Steven D. Dolvin

Scholarship and Professional Work - Business

This case would be considered a critical incident, as it focuses on one primary issue – the valuation of a private equity investment in the underlying business. I have constructed the case based on consulting work I completed for the actual company, as they needed a valuation model for accounting purposes. So, all data, including the legal characteristics, are obtained directly from the company. However, for confidentiality reasons, the name of the firm has been changed.

This case itself concerns the valuation of an investment by a private equity firm in a mid-market business. The student must evaluate and understand …

The Effectiveness Of Social Responsibility Courses In Higher Education, Courtney Droms Hatch, Sheryl-Ann Stephen

Scholarship and Professional Work - Business

Individual and corporate social responsibility has been gaining more and more attention over the last several years. We examine the effectiveness of incorporating social responsibility courses into the curriculum in higher education, with a specific look at Butler University. In general, the results indicate that implementing this type of curricular program is beneficial to the students but affects students differently based on their gender and age. Specifically, the results show that female students generally have a higher level of individual social responsibility than their male counterparts. The results also indicate that the students’ level of social responsibility influence their perceptions …

Spend Now Or Spend Later: The Role Of A Business Education And Critical Thinking Skills In Increasing Retirement Plan Saving Rates For New, Young Enrollees, Priscilla Arling, Jill Kirby, Kegan Saajasto

Scholarship and Professional Work - Business

For college graduates entering the workforce, contributing to an employer-sponsored 401(k) retirement plan can be an important way of saving for the future. However, contribution rates for young people in these plans are far below recommended percentages, leading to concerns about future financial stability for these individuals. Prior work has shown that a college student’s major and academic coursework affect their general financial knowledge. However, little is known about what content within a course of study correlates with specific financial decisions. The decision of how much to save in a 401(k) plan is complex and requires thinking beyond a present-day …