9/20/2023 — We study the performance and information acquisition behavior of mutual funds for both their long and short positions. We show that managers acquire relatively more information about their shorts because the benefit of acquiring information about shorts is larger.

• KEYWORD(S):
• finance

9/15/2023 — In contrast to the equivocal findings in academic research, “the business case for diversity” is the dominant rhetorical paradigm for how U.S. corporations debate actions and policies around racial/ethnic diversity. In this paper, we conduct an empirical test of the paradigm by gathering data on the race/ethnicity of the individuals shown on the leadership pages of S&P 500 firms’ websites as of mid-2011, 2014, 2017, 2020 and 2021, and then determining if any of nine measures of the racial/ethnic diversity of these executives reliably predict cross-sectional variation in any of six measures of their firms’ financial performance over the next fiscal year. We do not find reliable evidence that they do.

• KEYWORD(S):
• accounting
• race
• strategy and entrepreneurship

9/13/2023 — This paper uses transaction-level import data at the shipment level to examine how multinational companies importing to the US have restructured their supply chains during the COVID-19 pandemic. We find that companies sourced from fewer locations, reduced the share of imports from China, and increased the share of imports from other Asian countries, such as India and Vietnam, and North American countries, such as Canada and Mexico. For managers, our results imply that a one-size-fits-all mentality regarding supply chain disruption responses is not appropriate, and companies’ disruption-response strategies need to be tailored to individual supply chains’ circumstances.

• KEYWORD(S):
• operations

9/11/2023 — North Carolina’s phenomenal migration-driven population growth masks a troubling trend: high rates of death and dying prematurely which, left unchecked, can potentially derail the state’s economic growth and prosperity in the years ahead. On average, 246 North Carolinians died each day during the 2010s, increasing to 317 daily between April 1, 2020 and July 1, 2022. COVID-19 and the substance abuse crisis have played a major role in premature deaths of prime working age citizens of the state. Both people-based and place-based strategies and interventions are urgently needed to address the state’s death crisis.

• KEYWORD(S):
• disruptive demographics
• economic development policy
• strategy and entrepreneurship

9/8/2023 — This paper surveys the recent advances in machine learning method for economic forecasting. The survey covers the following topics: nowcasting, textual data, panel and tensor data, high-dimensional Granger causality tests, time series cross-validation, classification with economic losses.

• KEYWORD(S):
• economics
• finance
• machine learning

9/1/2023 — General Partners (GPs) in private equity face a trade-off between focusing their skills and effort on fewer investments to earn higher returns, or investing more broadly to reduce risk through diversification. Using a novel, deal-level dataset of 5,925 global investments from 1999 to 2016, we show that these portfolio considerations are important for understanding fund-level private equity returns.

• KEYWORD(S):
• finance
• private equity

8/12/2023 — This paper presents the development, validation, and implementation of a data-driven optimization model designed to dynamically plan the assignment of anesthesiologists across multiple hospital locations within a large multi-specialty healthcare system. We formulate the problem as a multi-stage robust mixed-integer program incorporating on-call flexibility to address demand uncertainty. The optimized dynamic staffing plan has been successfully implemented in the University of Pittsburgh Medical Center healthcare system, leading to estimated annual cost savings of 12\% compared to current practice, or about \$800,000 annually.

• KEYWORD(S):
• operations

7/31/2023 — Health care costs in the United States make up a larger proportion of gross domestic product (GDP) than in any other developed country and continue to rise. We examine whether the use of consistent metrics in costing information systems across hospitals provides one avenue to reduce these costs. We refer to such consistency as “costing information consistency” or CIC and empirically measure it by identifying whether hospitals in a multihospital system share the same costing system vendor. Using M&A activity among vendors as an instrument for exogenous changes in hospital CIC, we find that CIC is associated with a 13.3% reduction in operating expenses, suggesting that increased cost comparability from CIC helps hospitals identify ways to reduce operating expenses by identifying clinical and administrative best practices.

• KEYWORD(S):
• accounting

7/26/2023 — The 2022 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel was awarded to Ben S. Bernanke, Douglas W. Diamond, and Philip H. Dybvig “for research on banks and financial crises”. This article surveys the contributions of the three laureates and discusses how their insights have changed the way that academics and policymakers understand banks and their roles in financial crises.

• KEYWORD(S):
• finance

7/21/2023 — We examine the intersection of two major trends at online retail platforms: the emergence of retail media, which allows sellers to advertise on retail platforms alongside selling their products, and the platforms' switch away from reselling towards marketplace formats. We study whether and when a retail platform benefits from introducing sponsored advertising, and how the effects change with the platform's selling format. We consider two sellers with different qualities selling through a retail platform. We find that counter to our intuitions, offering sponsored advertising may not always benefit the platform, depending on its selling format.

• KEYWORD(S):
• marketing

7/17/2023 — Policies that require, or recommend, disclosure of corporate tax information are becoming more common throughout the world, as are examples of tax-related information increasingly influencing public policy and perceptions. In addition, companies are increasing the voluntary provision of tax-related information. We describe those trends and place them within a taxonomy of public and private tax disclosure. We then review the academic literature on corporate tax disclosures and discuss what is known about their effects.

• KEYWORD(S):
• accounting

7/12/2023 — We review the accounting literature on innovation, focusing on the attributes of innovation that collectively make it unique from other resources: novelty, nonrivalry, and partial excludability. These unique attributes help innovation drive economic growth but create information-based challenges that accounting researchers are well-suited to address. We discuss the definition and measurement of innovation, then review the accounting literatures on the disclosure, management, financial reporting, taxation, and contracting and financing of innovation. For each of these literatures we identify challenges and opportunities for future research.

• KEYWORD(S):
• accounting
• innovation

7/12/2023 — Co-brands are strategically advantageous partnerships which can also involve risk. For example, Papa John’s gained access to the largest television audience in the US by sponsoring the National Football League (NFL), but later blamed stagnant sales on how the NFL’s handled players’ well-publicized protests of inequitable policing. What implications did Papa John’s prioritization of sales over fairness have for NFL consumption? To answer this question, the current research tests for changes in Sunday watch party rituals (SWPR), when U.S. consumers gather to socialize while watching live NFL games.

• KEYWORD(S):
• marketing

6/27/2023 — Punishments are not always administered immediately after a crime is committed. Although scholars and researchers claim that third parties should normatively enact punishments proportionate to a given crime, we contend that third parties punish transgressors more severely when there is a time delay between a transgressor’s crime and when they face punishment for it. We theorize that this occurs because of a perception of unfairness, whereby third parties view the process that led to time delays as unfair.

• KEYWORD(S):
• organizational behavior

6/26/2023 — When a business model innovation (BMI) appears, incumbent firms experience great uncertainty about its potential ramifications and their capacity to assimilate the new business model. To resolve such uncertainty, incumbents seek to learn from industry peers, which can spark organizational herding. Organizational herding in BMI contexts is distinct, relative to product/technology adoption contexts, because in addition to peer behaviors, incumbents actively attempt to evaluate peer outcomes, and the importance of peer behaviors and outcomes likely vary, both over time and across types of peers.

• KEYWORD(S):
• innovation
• marketing

6/23/2023 — It is common wisdom that practice makes perfect. And, in fact, we find evidence that when given a choice between practicing a task and reflecting on their previously accumulated practice, most people opt for the former. We argue in this paper that this preference is misinformed. Using evidence gathered in ten experimental studies (N = 4,340) conducted across different environments, geographies, and populations, we provide a rich understanding of the conditions under which the marginal benefit of reflecting on previously accumulated experience is superior to the marginal benefit of accumulating additional experience.

• KEYWORD(S):
• operations

6/22/2023 — Although the level of power held by the marketing department can determine key organizational outcomes, including firm performance, we show that this power has been decreasing since 2007. To address this apparent disconnect, we propose that the board of directors is a critical but overlooked antecedent of marketing department power. In particular, we demonstrate that directors’ exposure through board service at other firms (i.e., board-interlocked firms) affects the marketing department’s power in the firms on whose boards they also serve (i.e., focal firms).

• KEYWORD(S):
• marketing

6/18/2023 — We investigate the role of information dissemination about cyberattacks through major newswires on municipal finance. Employing a difference-in-differences approach to identify causal effects, we find that county-level cyberattacks covered by the media cause increases in new offer yields and reduce bond issuance.

• KEYWORD(S):
• finance

6/4/2023 — In business markets, marketing and sales functions often conflict over customer acquisition. Marketers are seen to complain that sales representatives disregard the leads they generate, while sales representatives question the revenue potential of these leads. How should firms resolve such conflicts? We investigate these questions using relatively novel sequential principal-agent models with risk averse agents where asymmetry of information exists regarding leads’ revenue potentials.

• KEYWORD(S):
• marketing

6/4/2023 — We examine the consequences of corporate tax enforcement for business activity. Employing two different empirical approaches—a regional design and a firm-level design—we document that corporate tax enforcement is negatively associated with business activity. This association is economically significant and is robust to tests that mitigate concerns regarding endogeneity and measurement.

• KEYWORD(S):
• accounting

6/4/2023 — Lack of co-movement between consumption growth differentials and real exchange rates is a traditional indicator of a disconnect of foreign exchange markets from economic fundamentals (Backus-Smith 1993 anomaly). We present novel evidence for the (dis)connect between the volatilities, as opposed to the levels, of these variables. The volatility correlations are below one, but they are larger than the level correlations. In the cross-section of countries, the volatility disconnect weakens for countries with low amount of expected growth risk and high amount of volatility risk. We provide an explanation of our empirical findings based on international risk-sharing of both expected growth and volatility news shocks.

• KEYWORD(S):
• finance

6/4/2023 — About 27% of diabetics also suffer from depression, and the presence of co-morbid depression could increase the cost of care for diabetes by up to 100%. Several randomized clinical trials have demonstrated that physical and mental health are more likely to improve for diabetes patients suffering from depression when regular treatment for depression is provided in a primary care setting (called Collaborative Care). An important operational lever in managing Collaborative Care is the allocation of the care manager's time to enrolled patients based on their requirements, which in turn influences the revenue, costs, and patient health outcomes. We present a mathematical modeling approach that determines the optimal allocation of care manager's time and quantifies the costs and benefits of Collaborative Care.

• KEYWORD(S):
• operations

6/1/2023 — Throughout 2022, the Kenan Institute at UNC-Chapel Hill explored how ESG factors enter into and play a role in the decisions of corporate managers and investors. We have framed this analysis within the broader notion of “stakeholder capitalism,” a model in which business decisions reflect explicit consideration of their expected impact on a broader set of corporate stakeholders.

• KEYWORD(S):
• esg
• finance
• stakeholder capitalism

6/1/2023 — Multicultural experiences – such as living, traveling, or working abroad – can have many psychological benefits, including decreasing intergroup bias. However, unlike the intergroup contact literature, research on multicultural experiences has yet to examine whether the valence of these experiences may moderate such outcomes. So, could multicultural experiences actually increase intergroup bias? Five studies reveal that multicultural experiences increase (rather than decrease) intergroup bias when those experiences are negative (rather than positive).

• KEYWORD(S):
• organizational behavior

5/25/2023 — Companies face increasing pressure from different stakeholders to address various environmental, social and governance (ESG) issues. In their efforts to engage with these issues, they might pursue symbolic or substantive actions, either pre-emptively (proactive actions) or in response to specific targeted threats (reactive actions). Yet we know relatively little about how different stakeholders react to this repertoire of corporate actions and importantly, whether they are aligned in their reaction. We ask this question in the context of gender inequality, an issue that has become salient due to heightened societal attention thanks to the #MeToo movement.

• KEYWORD(S):
• esg
• gender
• inequality
• strategy and entrepreneurship

5/17/2023 — The executive labor market (ELM) is a topic of interest that spans several academic fields. The outcomes of the ELM, including executive selection, succession, and compensation, are important considerations as they influence executive decision making and other organizational outcomes. Yet, a comprehensive framework of ELM dynamics currently does not exist. To address this shortcoming, we reviewed the existing literature using five fundamental questions: (1) What executive jobs are available? (2) Who is available to fill executive jobs, and what is valued on the ELM? (3) Who signals interest in the executive jobs? (4) Who gets offered/accepts the executive job, and what is the agreed-upon compensation? (5) How do status and social capital influence ELM outcomes? By answering these questions, our review provides a framework for integrating existing research on the ELM while suggesting avenues for future research.

• KEYWORD(S):
• strategy and entrepreneurship

5/13/2023 — This study examines the spillover effect of environmental enforcement through private lending networks. Financial lending institutions face growing public and regulatory pressures to manage and reduce environmental risks relating to their lending activities and therefore are motivated to monitor corporate borrowers’ environmental practices.

• KEYWORD(S):
• accounting
• climate change
• corporate social responsibility

5/12/2023 — The rapid growth in the adoption of mobile payments has already begun to reshape bank payment practices. Utilizing a unique data set from a leading bank in Asia, which records credit card transactions of its customers before and after the launch of Alipay mobile payment, the largest mobile payment platform in the world, this study aims to understand the impact of mobile payment adoption on bank customer credit card activities and the change of this impact after the mobile payment expansion. To do so, we employ the difference-in-differences (DID) method coupled with matching to estimate the effects. We find that mobile payment adoption not only increases customer credit card activities at the focal bank through both offline and online channels but also enhances customer loyalty to the bank by reducing churn.

• KEYWORD(S):
• operations

5/5/2023 — We hypothesize that after a relaxation of short selling constraints, an escalation in short selling activity will heighten incentives for short sellers to accelerate price discovery by revealing their negative information. Consistent with this conjecture, we find that the overall sentiment of media coverage tilts significantly more negative for pilot relative to control firms following exogenous relief of short sale constraints.

• KEYWORD(S):
• accounting

5/3/2023 — This study finds that voluntary non-earnings disclosure substitutes for redacted proprietary contract information. When firms redact contract information, they provide more voluntary disclosures and have higher information uncertainty and asymmetry. Although firms provide both voluntary non-earnings and earnings disclosures when they redact contract information, only non-earnings disclosures included in Forms 8-K mitigate the higher information uncertainty and asymmetry associated with redaction. These findings suggest earnings disclosures may not be specific enough to substitute for redacted contract information and contrast with the presumption in related research that firms provide earnings disclosures to substitute for withheld proprietary information. 

• KEYWORD(S):
• accounting

5/1/2023 — Crowdsourcing as a mechanism of open innovation is a popular way for organizations to solicit ideas from external agents. Our research focuses on the relationship between examples in problem statements provided to a crowd and the subsequent number of ideas submitted by the crowd.

• KEYWORD(S):
• marketing
• strategy and entrepreneurship

4/28/2023 — We use textual analysis of mandatory accounting filings to develop firm-level, time-varying measures of exposure to individual government agencies. The measures vary predictably across industries and with broad regulatory interventions that expanded the scope and power of different government agencies, but also include substantial firm-specific, time-varying components.

• KEYWORD(S):
• accounting

4/18/2023 — Theories of crowdsourced search suggest that firms should limit the search space from which solutions to the problem may be drawn by constraining the problem definition. In turn, problems that are not or cannot be constrained should be tackled through other means of innovation. We propose that unconstrained problems can be crowdsourced, but firms need to govern the crowds differently.

• KEYWORD(S):
• strategy and entrepreneurship

4/17/2023 — When policymakers implement a disinflation program directed at high inflation, the real dollar value of their country’s stock market index experiences a cumulative abnormal 12-month return of 48 percent in anticipation of the event. In contrast, the average cumulative abnormal 12-month return associated with disinflations directed at moderate inflation is negative 18 percent. The 66-percentage point difference between cumulative abnormal returns, along with descriptive evidence and case studies, suggests that unlike the swift eradication of past high inflations documented by Sargent (1982), the US will not experience a quick, low-cost transition from moderate inflation to the Fed’s two-percent target.

• KEYWORD(S):
• economics
• finance
• inflation

4/13/2023 — Using confidential offer-level data on the US housing market, this paper examines the rounding-off heuristics in the bilateral bargaining process. We demonstrate that home sellers and home buyers follow different rounding-off heuristics. While sellers' list prices cluster more frequently around charm numbers (e.g. 349,999), buyers' offer prices and negotiated final sales prices cluster at salient round numbers.

• KEYWORD(S):
• finance

4/10/2023 — Recent research has documented that industry concentration has increased significantly over the past 25 years, with potentially negative consequences for competition, productivity, and social welfare. Some have suggested that greater corporate tax planning by industry leaders, which can provide them with a cost advantage over their competitors, has contributed to this trend. As a result, policymakers are targeting such tax planning to reduce industry concentration.

• KEYWORD(S):
• accounting

4/6/2023 — Entrepreneurs making decisions under uncertainty are encouraged to evaluate their initial ideas through hypothesis testing, but entrepreneurial approaches vary in their emphasis on ex-ante theory development prior to collecting evidence. In this paper, we examine whether and how entrepreneurs benefit from adopting an evidence-based approach or a theory-and-evidence-based approach to decision-making.

• KEYWORD(S):
• strategy and entrepreneurship

3/14/2023 — In the wake of the COVID-19 pandemic, two large infrastructure-related bills have been enacted. The Infrastructure Investment and Jobs Act (IIJA), signed into law in November 2021, provides funding for a wide range of activities including roads, rail, transit, broadband, water and electrical infrastructure.

3/13/2023 — George Floyd's murder caused many firms to reveal how exposed they are to racial diversity issues. We examine investor and firm behaviors after this socially significant event to provide evidence on the valuation effects of the exposure and ensuing corporate responses. We develop a text-based measure of a firm's exposure to racial diversity issues from conference call transcripts and find that, after the murder of George Floyd, firms with diversity exposure experience a stock price decrease of approximately 0.7% around the date of the conference call. We provide evidence that this effect is attributable to race-related exposure and not gender-related exposure. Initiatives taken by firms mitigate the negative market reaction.

• KEYWORD(S):
• accounting
• DEI
• machine learning

3/10/2023 — Virginia’s rapid population growth over the past three decades has been uneven, creating demographic winners and losers, and masks several demographic headwinds that will constrain future growth and competitiveness if left unaddressed, including slowing rates of total and foreign-born population growth, white population decline, deaths of despair, and declining labor force participation among prime working age males and females in the state.

• KEYWORD(S):
• disruptive demographics
• economic development policy

3/8/2023 — We quantify the immediate net effect of the Tax Cuts and Jobs Act (TCJA) on the tax burden of corporate profits for public US corporations.

• KEYWORD(S):
• accounting
• global business

3/7/2023 — As individuals seek success, destructive interpersonal clashes can emerge when they believe they can only succeed at the expense of others. Prior work suggests this zero-sum construal of success is more likely occur when people receive negative feedback regarding their achievement. In the present research, we identify another element in the workplace that can strengthen zero-sum beliefs, and not just for those who receive negative feedback, but even for those who receive positive feedback.

• KEYWORD(S):
• organizational behavior

3/7/2023 — How do an organization's task requirements affect the ways in which it reacts to competitors’ strategic investments? This study uses a novel measure of task requirements (Case Mix Index), to test the competitive and spillover effects of prior adoption on a focal organization's timing of adoption, while accounting for the underlying demand-side drivers of adoption.

• KEYWORD(S):
• innovation
• strategy and entrepreneurship

3/1/2023 — We examine firm disclosure choice during the initial public offering (IPO) roadshow presentation to understand the informativeness of a management presentation designed to attract investors. Although firms submit a comprehensive registration filing during the IPO, managers also prepare a roadshow presentation, which is shorter and typically allows managers more autonomy to select the information released and how it is discussed. We find that IPO roadshows have significantly more positive, less negative, and less uncertain language than the SEC filing.

• KEYWORD(S):
• accounting
• machine learning

2/28/2023 — Acquisitions are notoriously difficult to execute successfully. Poor implementation of the post-acquisition integration process is a major source of acquisition value destruction. To surface new solutions for this vexing problem, we leverage the emerging triadic view of M&A activities, which emphasizes the interconnectedness between sellers, acquirers, and the units that are transferred between them.

• KEYWORD(S):
• strategy and entrepreneurship

2/27/2023 — Food ordering and delivery platforms generate online demand for restaurants and deliver food to customers. In return, restaurants pay platforms a commission, typically a percentage of the order amount. Platforms offer partner restaurants the choice of a range of commission rates, rewarding higher commission payments with featured display slots and discounted delivery fees, both of which stimulate demand. Unfortunately, the current environment is grim: platforms scurry to cover delivery costs while restaurants gripe about excessive commissions.

• KEYWORD(S):
• operations

2/24/2023 — Ignoring consideration sets in modeling customer purchase decisions may lead to biased estimation of customer preferences, yet consideration sets are difficult to infer in brick-and-mortar contexts. We show that the challenge of estimating consideration set models in brick-and-mortar contexts can partially be overcome with an emerging source of data: “heatmap data” collected using in-store sensors.

• KEYWORD(S):
• operations

2/17/2023 — Despite encouraging signs, India’s retail market remains largely off-limits to large international retailers like Wal-Mart and Carrefour. Opposition to liberalizing FDI in this sector raises concerns about employment losses, unfair competition resulting in the large-scale exit of incumbent domestic retailers, and infant industry arguments to protect the organized domestic retail sector that is at a nascent stage. Based on international evidence, we suggest that allowing entry by large international retailers into the Indian market may help tackle inflation, especially in food prices.

• KEYWORD(S):
• economics
• finance
• global business
• inflation

2/15/2023 — We study price optimization under the mixture of boundary logit (MBL) model, which was recently introduced in Jagabathula et al. (2020) and Jagabathula and Venkataraman (2022). We show that the pricing problem under the MBL model is hard to solve in the most general case. However, we prove structural results for the general pricing problem and characterize the optimal solution for several special cases, including a setting in which all products are charged the same price, and a setting with two products.

• KEYWORD(S):
• operations

2/9/2023 — This study documents that big bath accounting following CEO turnovers is pervasive worldwide and shows that the extent to which CEOs engage in big bath accounting is associated with the degree of discretion they have available in their respective countries. Our analysis is based on a new country-level measure for managerial discretion derived from a questionnaire survey with more than 500 strategy consultants from 35 countries.

• KEYWORD(S):
• accounting
• global business