Latest Publications

Latest Published Work

by Merage School Faculty Members

Accounting

Professor Elizabeth Chuk

Title: “What Have We Learned About Earnings Management? Integrating Discontinuity Evidence” Co-authors: Dave Burgstahler Accepted at: Contemporary Accounting Research

The accounting literature includes numerous examples of discontinuities at prominent benchmarks that are widely interpreted as evidence that earnings are managed to meet those benchmarks. However, there are a few examples where discontinuities do not exist, which are sometimes interpreted as inconsistent with earnings management. Alternative explanations for discontinuities have also been suggested. This paper reviews, evaluates, and integrates the available evidence and concludes that the theory that earnings are managed to meet benchmarks provides the simplest and most complete explanation for the body of discontinuity-related evidence.

Professor Radhika Lunawat

Title: “Reputation Effects of Information Sharing” Accepted at: Journal of Economic Behavior & Organization

This paper analyzes a model of investment and return in an economy characterized by information asymmetry between an investor and a manager. The realized value of the uncertain state manager cannot share her private information with the investor. Therefore, dividend payment is the only reputation building tool available to the then the manager will return a dividend consistent with the lower possible state of nature having occurred and the investor will revise such beliefs downwards. However, if the beliefs are not so high, then the equilibrium will be mixed strategies.

The paper then compares such a dividendonly economy with one where information sharing is an additional tool available for building reputation. Information sharing disciplines the potential opportunism accruing to a manager out of her informational advantage. It provides ex results in a greater region of pure strategy play in the dividend-and-information-sharing economy. Since such pure strategy play implies investment

with certainty, information sharing leads to higher investment. Further, pure strategy play implies returns consistent with the actual state of nature in the dividend-and-information-sharing economy while it implies dividend consistent with the lower state of nature in the dividend-only economy and these lead to higher return in information sharing.

Professor Mort Pincus

Title: “The Risk Relevance of Taxable Income” Co-authors: D. Dhaliwal, H. S. Lee, and L. Steele Accepted at: Journal of American Taxation Association

Dhaliwal, Lee, Pincus, and Steele study whether taxable income (TI) provides incremental information TI-based variance and covariance measures that are useful in assessing risk in a simple earnings predictability model. In our empirical tests these TI-based measures incrementally explain crosssectional variation in the predictability and variability of future pre-tax BI, and are associated with predictable variation in market-based measures of risk as well as improving our understanding of the extent and nature of information contained in TI. An implication of our results is that conforming book and tax reporting would eliminate the ability to compute risk assessments.

Professor Mort Pincus

Title: “Material Weaknesses in Tax-Related Internal Controls and Last Chance Earnings Management” Co-authors: C. Gleason and S. Rego Accepted at: Journal of American Taxation Association

consequences of income tax-related material identify and disclose. We hypothesize that the presence of internal control material weaknesses (ICMWs) over the tax function makes earnings earnings forecasts through the income tax accrual tax-related ICMWs. We also predict that the remediation of tax-related ICMWs has the effect of constraining earnings management through the tax accrual. The results provide support management using the tax accrual is concentrated in the early years of our sample period, that is, in the initial Sarbanes-Oxley Act (SOX) implementation period. The results suggest that tax-related ICMWs were initially associated with greater tax-expense management and that SOX internal control assessments, at least regarding tax-related ICMWs, subsequently reduced taxaccrual earnings management.

Professors Mort Pincus and Patricia Wellmeyer

Title: “Do Clients’ Enterprise Systems Affect Audit Quality and Efficiency?” Co-authors: Feng Tian and Sean Xin Xu (PhD Alumni) Accepted at: Contemporary Accounting Research

Enterprise systems (ESs) are widely used to support business processes along the enterprise value chain. It has been shown that ESs, by integrating business functions and making information about day-to-day activities available, enhance operational transparency and improve the internal information environment. However, while ES-based business infrastructures increased complexity have also brought new challenges to external auditors. Motivated by the prominence of this issue for auditors and regulators and by the scarcity of research investigate whether the presence and extent of proprietary archival data on ES implementations there are fewer restatements, a greater likelihood of auditors issuing going concern opinions to auditing quality, a lower likelihood of Form 10-K increase with the scope of implementation and are generally greater when the ES includes material weaknesses in advance of restatement presence of ESs, auditors issue an excessive number of going concern opinions to clients that survive.

Professor Terry Shevlin

Title: “An Examination of Firms’ Responses to Tax Forgiveness” Co-authors: Jacob Thornock and Braden Williams Accepted at: Review of Accounting Studies

This study uses state tax amnesties to authority. We posit that tax forgiveness programs alter taxpayer perceptions of the probability of detection by enforcers or the probability of future forgiveness programs, either of which could state increase state income tax aggressiveness incrementally increases with each additional

the effect of amnesties on tax aggressiveness less tax authority scrutiny and for which the tax aggressiveness measures are less confounded. of tax forgiveness have increasingly negative implications for corporate tax collections.

Professor Terry Shevlin

Title: “Does U.S. Foreign Earnings Lockout Advantage Foreign Acquirers?” Co-authors: Andrew Bird and Alex Edwards Accepted at: Journal of Accounting and Economics

acquirers of U.S. targets with greater lockedout earnings because they can avoid the U.S. tax on repatriations. This effect is economically lockout is associated with a 12% relative increase in the likelihood that an acquirer is foreign. We countries that use territorial tax systems, as the target with locked-out earnings are even greater for these acquirers.

Professor Terry Shevlin

Title: “Book-tax Conformity and Capital Structure” Co-authors: Bradley Blaylock and Fabio Gaertner Accepted at: Review of Accounting Studies

We examine the effect of increased booktax conformity on corporate capital structure. Prior studies document a decrease in the informativeness of accounting earnings for equity markets resulting from higher book-tax conformity. We argue that the decrease in earnings informativeness impacts equity holders more than debt holders because of the differences in payoff structures between debt and equity investments such that increases in book-tax conformity lead tax conformity increase leverage relative to other facing an increase in required book-tax conformity in cost of equity capital are positively associated and towards more debt in the presence of higher book-tax conformity.

Professor Terry Shevlin

Title: “Analyst monitoring, information asymmetry, and tax planning activities: Evidence from a natural experiment” Co-authors: Novia Chen and Peng-Chia Chiu (PhD Alumni) Accepted at: Contemporary Accounting Research

We exploit an exogenous shock to analyst coverage as a result of brokerage house mergers they cover. Using a difference-in-differences design, million. The treatment effect is more pronounced To explore how analysts affect tax planning, we further document that the treatment effect is greater Overall, we provide evidence that a shock to analyst tradeoff of tax planning.

Economics/Public Policy

Professor Mireille Jacobson

Title: “Evaluating The Role Of Payment Policy In Driving Vertical Integration In The Oncology Market” Co-authors: Abby Alpert and Helen Hsi Accepted at: Health Affairs

The health care industry has experienced massive consolidation over the past decade. Much of the consolidation has been vertical (with hospitals acquiring physician practices) instead of horizontal (with physician practices or hospitals merging with similar entities). We documented the increase in vertical integration in the market the rate of hospital or health system ownership of practices doubled from about 30 percent to about 60 percent. The two most commonly cited explanations for this consolidation are a 2005 Medicare Part B payment reform that dramatically reduced reimbursement for chemotherapy drugs, and the expansion of hospital eligibility for the Care Act (ACA). To evaluate the evidence for these explanations, we used differencein-differences methods to assess whether consolidation increased more in areas with greater exposure to each policy than in areas with less exposure. We found little evidence that either

increased consolidation in the market for cancer care may be part of a broader post-ACA trend toward integrated health care systems.

Professor Mireille Jacobson

Title: “Going to Pot? The Impact of Dispensary Closures on Crime” Co-authors: Tom Chang Accepted at: Journal of Urban Economics

recently, recreational marijuana use often allow retail sales at dispensaries. Dispensaries are controversial as many believe they contribute to local crime. To assess this claim, we analyze the short-term mass closing of hundreds of medical marijuana dispensaries in Los Angeles. increase in crime around dispensaries ordered to close relative to those allowed to remain open. most plausibly deterred by bystanders, and is similar pattern of results for temporary restaurant closures due to health code violations. A likely deter some types of crime.

Finance

Professor David Hirshleifer

Title: “Innovative Originality, Profitability, and Stock Returns” Co-authors: Po-Hsuan Hsu, and Dongmei Li Accepted at: Review of Financial Studies.

We propose that innovative originality (InnOrig) is a valuable organizational resource, and that owing to limited investor attention and InnOrig strongly predicts higher, more persistent, extensive controls. The return predictive power of uncertainty, lower investor attention, and greater evidence suggests that innovative originality undervalues InnOrig.

Professor David Hirshleifer

Title: “Superstition and Financial Decision Making,” Co-authors: Jian Ming, and Huai Zhang Accepted at: Management Science

In Chinese culture, certain digits are lucky and others unlucky. We test how such numerological numerical stock listing codes exceeds what would be expected by chance. Also consistent lucky listing codes experience inferior post-IPO abnormal returns. Further tests suggest that our conclusions are not driven by endogeneity.

Professor David Hirshleifer

Title: “Opportunism as a Managerial Trait: Predicting Insider Trading Profits and Misconduct” Co-authors: Usman Ali Accepted at: Journal of Financial Economics

We show that opportunistic insiders can be and that opportunistic trading is associated with value-weighted trading strategy based on (not – much higher than in past insider trading literature Firms with opportunistic insiders have higher levels of earnings management, restatements, SEC enforcement actions, shareholder litigation, suggest that opportunism is a domain-general trait.

Professors David Hirshleifer and Siew Hong Teoh

Title: “How Psychological Bias Shapes Accounting and Financial Regulation” Accepted at: Behavioral Public Policy Journal

Most applications of behavioral policy focus on alleviating the adverse effects e.g., through investor protection rules or nudges. We argue that it is equally important to understand how psychological bias can cause a collective dysfunction – bad accounting here how psychological bias on the part of the designers of regulation and accounting policy (voters, regulators, politicians, media commentators, managers, users, auditors, and regulation, and how understanding of this process ideologies are belief systems that have evolved and spread by virtue of their ability to recruit psychological biases. We examine how

several psychological factors and social processes affect regulatory ideologies.

Professor Chong Huang

Title: “Bayesian Persuasion in Coordination Games” Co-authors: Itay Goldstein Accepted at: American Economic Review

We analyze a coordination game of regime change where the policy maker, who tries to increase the probability of the survival of the regime, commits ex ante to abandon the regime automatically when its fundamentals are below a certain threshold. This policy acts as an information transmission mechanism: agents, who decide whether to attack the regime or not, update positively about the fundamentals of the regime when they see that it has not been abandoned, and so they are less likely to attack. Using the commitment ability, the policy maker can thus increase the overall survival probability of the regime.

Professor Chong Huang

Title: “Defending against Speculative Attacks: the Policy Maker’s Reputation” Accepted at: Journal of Economic Theory

This paper studies how speculative attacks and regime change arise from the interaction receive conditionally independent and identically type in every period, then no matter how precise their per-period private signals are, there can be no equilibrium with attacks. If the speculators receive private signals whose precision increases as a power function of the time with the power many equilibria with attacks, but this equilibrium multiplicity arises from the timing of the attacks only. In such a case, the set of status quos surviving in any equilibrium is strictly larger than in the case of a short-lived policy maker.

Professor Chong Huang

Title: “The Real Costs of Financial Efficiency When Some Information Is Soft” Co-authors: Alex Edmans and Mirko Heinle Accepted at: Review of Finance

former depends on the total amount of information available, the latter depends on the relative amounts of hard and soft information. Disclosing more hard information (e.g., earnings) increases reducing the cost of capital. However, it induces the manager to prioritize hard information over soft by cutting intangible investment to boost earnings,

desirable to induce investment, the manager may be unable to commit to it. Optimal government policy may involve upper, not lower, bounds on

Professor Christopher Schwarz

Title: “Revisiting Mutual Fund Disclosure” Co-authors: Mark Potter Accepted at: Review of Financial Studies

contain many voluntarily reported mutual fund many SEC mandated portfolios available in disclosures are likely driven by convenience rather than duplicity. Although mandated portfolios contain securities with more return momentum, we inaccurate position information prior to 2008. Our highlighting a 35% increase in observed manager trading by combining data sources.

Professors Zheng Sun and Lu Zheng

Title: “Only Winners in Tough Times Repeat: Hedge Fund Performance Persistence over Different Market Conditions” Co-authors: Ashley Wang Accepted at: Journal of Financial and Quantitative Analysis

We provide novel evidence that hedge fund performance is persistent following weak hedge fund markets but is not persistent following hedge fund sector returns. After adjusting for risks, outperform funds in the lowest quintile by about 7 percent in the subsequent year, whereas funds future fund performance over a horizon as long as three years, for both winners and losers, and for funds with few share restrictions.

Information Systems

Professors Vidyanand Choudhary, Imran Currim, Sanjeev Dewan, and John Turner

Title: “Evaluation Set Size and Purchase: Evidence from a Product Search Engine” Co-authors: Ivan Jeliazkov and Ofer Mintz, PhD Alumnus Accepted at: Journal of Interactive Marketing

The last decade has seen a dramatic increase in the popularity of product search engines, yet the analysis of consumer behavior at such sites remains a challenging research problem despite its timeliness and importance. In this article, we develop and estimate a copula model of evaluation set size and purchase behavior employing data from 3,182 hotel searches by customers at a large travel search engine. The model allows us to jointly study purchase behavior, evaluation sets, and their antecedents. Our results reveal that evaluation set size and purchase are negatively correlated and that factors typically presumed to be associated with purchase – i.e., when users sort search results by price or quality, request many rooms, disclose that there are many guests in their party, or arrive actually relate to larger evaluation sets but lower the search results, we observe smaller evaluation sets and higher purchase probability. The theoretical suggest that efforts to increase purchases need not necessarily be predicated on cultivating larger evaluation sets.

Professor Vidyanand Choudhary

Title: “Targeted Couponing in Online Auctions” Co-authors: Shivendu Shivendu Accepted at: Information Systems Research

In order to study the role of targeted couponing in auctions, we develop a stylized model in which bidders have heterogeneous valuations and participation costs wherein their entry probabilities probability including negative externalities for the bidder who does not receive a coupon and (ii) to the low-valuation bidder can be optimal for the from value extraction. A novel result is that in the context of auctions it can be optimal for the seller to issue targeted coupons to the high-valuation valuation or reduction in the participation cost is driven by the non-monotonicity of the joint entry probability of the two bidders and the seller valuations and participation costs.

Marketing

Professor Tonya Bradford

Title: “Dwelling Dynamics in Consumption Encampments: Tailgating as Emplaced Brand Community” Co-authors: John F. Sherry, Jr. Accepted at: Marketing Theory

Tailgating is an institutionalized form of public revelry and emplacement of brand community that occurs within the context of a consumption encampment. In this ethnographic investigation of tailgating in an American collegiate football setting, we explore the dwelling practices of stakeholders involved in the event. In the duration of a tailgate, a city is raised, and ultimately razed. Over the course of a day, a nomadic brand community encampment arises, replete with ersatz homes, a grid of streets with ingenious address coordinates, exchange. By examining the process of dwelling, we unpack the mechanics of the space-to-place transformation that characterizes consumption encampments. We analyze the role of three architectonic pillars of tailgating – chorography, conviviality, and community - in the emplacement of brand community, and theorize the spatial essence of the collegiate brand.

Professor Tonya Bradford

Title: “Weight Loss through Virtual Support Communities: A Role for Identity-Based Motivation in Public Commitment” Co-authors: Sonya A. Grier and Geraldine Rosa Henderson Accepted at: Journal of Interactive Marketing

Individuals increasingly participate in virtual support communities (VSC) where they conduct numerous aspects of their lives with others whom they may never encounter in person, and they interact within these communities to attain various likely to achieve success with such goals when they make a public commitment to achieving them. Through our netnographic inquiry, we extend prior theorizing of VSC with an explanation of how public commitment manifests in VSC in support these online communities make salient a context relevant social identity which motivates behaviors that facilitate compliance to the public commitment, and hence, more effective goal pursuit. In addition, we create a typology of member roles within these commitment.

Professor Imran Currim

Title: “A Model for Inferring Market Preferences from Online Retail Product Information Matrices” Co-authors: Tim Gilbride, Ofer Mintz, PhD Alumnus, and S. Siddarth Accepted at: Journal of Retailing

This research extends information display board methods, currently employed to study information processing patterns in laboratory yields managerially useful estimates of market preferences. A new model is proposed based on statistical, behavioral, and economic theories, which integrates three decisions consumers must make in this context: which product-attribute to inspect next, when to stop processing, and which, if any, product to purchase. Several theoretical options are considered on how to model product attribute selection and how to treat uninspected attributes. The modeling options are empirically tested employing datasets collected at a popular product evaluation and purchase decisions. Subsequent to identifying the best model, we show how the resulting attribute preference estimates can be managerially employed to improve customer targeting of abandoned shopping carts, for follow up communications aimed at improving sales conversions.

Professor Imran Currim

Title: “Commitment to Marketing Spending through Recessions: Better or Worse Stock Market Returns?” Co-authors: Jooseop Lim (PhD Alumnus) and Yu Zhang Accepted at: European Journal of Marketing

This study addresses two unique and important questions. First, how do recessions spending through past recessions achieve better employing panel data based regression models to marketing spending during past recessions are found to be robust across B2B and B2C vary on the proportion of their global revenue from U.S. sales. They key managerial implication is that top executives cut marketing budgets during recessions, however, if they can resist the pressures, and strategically continue to make marketing investments during recessions they will achieve higher stock market returns.

Professor Imran Currim

Title: “Effect of Analysts’ Earnings Pressure on Marketing Spending and Stock Market Performance” Co-authors: Jooseop Lim (PhD alumnus) and Yu Zhang Accepted at: Journal of the Academy of Marketing Science

pressures on C-level executives in the popular press, there is limited evidence on their effects on marketing spending decisions. This study asks two 2009 compiled from Institutional Brokers Earning more committed in the past to marketing spending committed to marketing spending under past are robust across measures, controls, and methodologies. Consideration of two industry key implication is that top executives respond to pressures, longer-term stock market performance is higher.

Professor Mary Gilly

Title: “The Role of Marketing in Ritual Evolution” Co-authors: Samantha Cross (PhD Alum) and Robert Harrison Accepted at: Journal of Macromarketing

Thanksgiving in the U.S. is a ritual with shared meanings. This research evaluates the meanings of symbolic representations in advertising to understand the role of the media in the construction, maintenance, and evolution of ritual celebration. Thanksgiving advertisements published over a 99-year period are analyzed using a methodological mixture of semiotic analysis, historical analysis and context-driven periodization. The result is a multi-layered understanding of inter-related aspects of advertising history and the role of the media in the evolution of consumption ritual-making. Media are seen as agents for creating and legitimizing cultural norms, adding to our appreciation of normative and cultural-cognitive practices in supporting evolving social institutions. Findings show that marketers create and maintain the norms associated with Thanksgiving celebrations,

moving us to the next stage in the evolutionary process. This research also highlights how cultural mythmaking strategies are employed and develop into historical brand narratives.

Professor Mary Gilly

Title: “Temptation’s itch: Mindlessness, acceptance, and mindfulness in a debt management program” Co-authors: Mary Wolfinbarger Celsi, Russel P. Nelson, and Stephanie Dellande (PhD alumni) Accepted at: Journal of Business Research

This study examines the experience of temptation through the accounts of consumers who have entered a debt management plan (DMP). During 12 weeks, participants reported weekly temptations. The results are consistent circumstances as providing them the opportunity consumers engage in three patterns of responses mindlessness, acceptance, and mindfulness. in the DMP is associated with mindfulness, as

Professor Eric Spangenberg

Title: “A Meta-Analytic Synthesis of the QuestionBehavior Effect” Co-authors: David E. Sprott, Ioannis Kareklas, and Berna Devezer Accepted at: Journal of Consumer Psychology

Asking people a question about performing of that behavior. While contextually robust as evidenced by the large number of proposed explanations for the effect. Furthermore, considerable heterogeneity exists regarding which the effect has manifested. A meta-analytic across 51 published and unpublished papers the effect into four overarching categories, we derive and test systematic predictions regarding potential moderators of conceptual and practical degrees of support for four different theoretical and motivations) proposed to underlie the effect. Insights into these mechanisms are presented and outstanding gaps in our understanding are

Professor Rajeev Tyagi

Title: “Outsourcing to Convert Fixed Costs into Variable Costs: A Competitive Analysis” Co-authors: Yunchuan Liu Accepted at: International Journal of Research in Marketing

Outsourcing of production, services, and various economic activities is a pervasive phenomenon across industries. One of the key mentioned by its sellers and buyers, is that it costs such as expenditures on equipment, employees etc., and convert those into a variable cost in the form of the purchase price that the This paper examines the strategic implications of this role of outsourcing in an oligopolistic setting. We show how these strategic considerations imply that, even absent any cost savings from to outsource. Furthermore, in such a setting, one examine how consumer and social welfare are adversely affected when outsourcing plays this oligopolistic setting.

Professors Rajeev Tyagi and Sreya Kolay

Title: “Product Similarity and Cross-Price Elasticity” Accepted at: Review of Industrial Organization

Cross-price elasticity is one of the most commonly used constructs in theoretical and empirical work in the areas of pricing and market structure. A higher cross-price elasticity between two products means that they are more substitutable, and is often suggested as an indication that these products are more similar to each other in their characteristics. This implied positive relationship between cross-price elasticity and similarity between products is used in a large number of academic empirical studies, in courts in legal cases, and in merger analysis.

This paper investigates theoretically the relationship between the similarity between two products and the cross-price elasticities between them. Using a spatial competition model, we show how making two products more similar on product attributes could increase, decrease, or have an inverted-U shaped effect on cross-price elasticity. Thus, we show how the relationship between cross-price elasticity and similarity between products is more nuanced than the positive relationship posited in the literature. We also show how the direction of this relationship is affected (e.g., product qualities), the nature of the increase

base strength, and the nature of the disutility that consumers incur by buying a product that is away from their ideal points.

Professor Alladi Venkatesh

Title: “Regaining control through reclamation: how consumption subcultures preserve meaning and group identity after commodification.” Co-authors: Kristen Schiele Published in: Consumption, Markets & Culture

We examine the process of subcultural Harajuku) are created, fragmented, and then consider the role of authenticity in subcultures and multi-method ethnographic approach, we explore how a subculture reacts when faced with cooptation. This analysis promotes understanding of how a non-Western subculture reacts after they employ to regain control of their community by reclaiming authenticity, maintaining collective belonging, and uniting with a common cause.

Operations and Decision Technologies

Professor Libby Weber

Title: “A Socio-cognitive View of Repeated Interfirm Exchanges: How the Co-evolution of Trust and Learning Impacts Subsequent Contracts” Accepted at: Organization Science

exchanges with social cognition to expand the understanding of trust development and learning, and how these combined forces shape subsequent contracts. Although scholars have extensively examined the independent effects of trust and learning on contracts in repeated exchanges, their co-evolution and combined impact have received much less attention. I argue this omission largely occurs because social cognition is not typically considered in these literatures, even though both trust development and learning are socio-cognitive processes (contract frames) and cognitive biases (intergroup attribution bias). When these processes are examined in a positive exchange, the contract reputation-based trust or prior development of knowledge-based trust (competence or integrity), which biases what is learned. This biased learning further impacts knowledge-based trust development, and together these factors

shape adjustments to subsequent contracts. In a negative exchange, the contract frame, prior reputation-based trust, and partner explanation (internal versus external) impacts what is learned from partner violations (competence or integrity). trust development, and together they shape how subsequent contracts are adjusted. I also propose as complements or substitutes for different types of trust, addressing existing debates and critiques in these literatures. Finally, I discuss the dark side of integrity trust and trust repair under promotion contracts in repeated exchanges.

Professor L. Robin Keller

Title: “Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior Knowledge” Co-authors: Luping Sun, Xiaona Zheng, and Meng Su Accepted at: Journal of International Marketing

Most research on the performance of foreign versus domestic brands in emerging markets examines measures of product evaluation or purchase intention. However, consumers intending to buy a product may switch to competing brands, displaying an intention-behavior discrepancy (IBD). Drawing upon literature on country associations and dual process theory, we examine the difference in IBD of foreign versus domestic brands in emerging markets and the moderating role of prior knowledge. We conducted an intention survey followed by a post-purchase survey in the Chinese automobile and smartphone industries. We found that foreign brands have an advantage on IBD relative to domestic brands, indicating that they have the dual advantage of higher evaluations and lower IBDs. Furthermore, consumers with inaccurate prior knowledge, as they are more likely to systematically reprocess country associations. For these consumers, overestimating the product reduces foreign emerging markets.

Professor L. Robin Keller

Title: “Markov Chain Models in Practice: A Review of Low Cost Software Options” Co-authors: Jiaru Bai (PhD Student) and Cristina del Campo Accepted at: Investigación Operacional

Markov processes (or Markov chains) are used for modeling a phenomenon in which changes over time of a random variable comprise a sequence of values in the future, each of which depends only on the immediately preceding state, not on other past states. A Markov process (PM) is completely characterized by specifying the

probabilities (i.e. time-invariant) of transition between these states. The software most used in medical applications is produced by TreeAge, since it offers many advantages to the user. But, the cost of the TreeAge software is relatively high. Therefore, in this article two software alternatives are presented: Sto Tree and the zero cost add-in example of a cost-effectiveness analysis of two possible treatments for advanced cervical cancer, previously conducted with the Treeage software, is re-analyzed with these two low cost software packages. This paper was also written in Spanish to facilitate communication with Spanish-speaking scholars in Cuba and elsewhere, who aim to conduct Markov cost effectiveness analyses and

Professor L. Robin Keller

Title: “Information Presentation in Decision and Risk Analysis: Answered, Partly Answered, and Unanswered Questions” Co-authors: YiTong Wong, PhD Alumnus Accepted at: Risk Analysis

For the last thirty years, researchers in risk analysis, decision analysis, and economics have consistently proven that decision makers employ different processes for evaluating and combining anticipated and actual losses, gains, delays and surprises. While rational models generally heuristic processes will sometimes lead them to be inconsistent in the way they respond to information presented in theoretically equivalent ways. We point out several promising future research directions by listing and detailing a series of answered, partly answered, and unanswered questions.

Professor L. Robin Keller

Title: “Preference Functions for Spatial Risk Analysis” Co-authors: Jay Simon (PhD Alumnus) Accepted at: Risk Analysis

geographic region, measures of spatial risk regarding these outcomes can be more complex than traditional measures of risk. One of the main challenges is the need for a cardinal preference function that incorporates the spatial nature of the outcomes. We explore preference conditions that will yield the existence of spatial measurable value and utility functions, and discuss their application to spatial risk analysis. We also present a simple example on household freshwater usage across regions to demonstrate how such functions can be assessed and applied.

Professors Carlton Scott and John Turner

Title: “Mixed Planar and Network Single-Facility Location Problems” Co-authors: Zvi Drezner Accepted at: Networks

We consider the problem of optimally locating a single facility anywhere in a network to serve both on-network and off-network demands. Off-network demands occur in a Euclidean plane, while on-network demands are restricted to a network embedded in the plane. On-network demand points are serviced using shortest-path distances through links of the network (e.g., on-road travel), whereas demand points located in the plane are serviced using more expensive Euclidean distances. Our base objective minimizes the total weighted distance to all demand points. We develop several extensions to our base model, including: (i) a threshold distance model where if network distance exceeds a given threshold, then service is always provided using Euclidean distance, and (ii) a minimax model that minimizes worst-case distance. We in conjunction with bounds tailored for each problem class. Computational experiments demonstrate the effectiveness of our solution procedures. Solution times are very fast (often under one second), making our approach a good candidate for embedding within existing heuristics that solve multi-facility problems by solving a sequence of single-facility problems.

Professor John Turner

Title: “A Unified Framework for the Scheduling of Guaranteed Targeted Display Advertising under Reach and Frequency Requirements” Co-authors: Ali Hojjat (PhD Alumnus), Suleyman Cetintas, Jian Yang Accepted at: Operations Research

Motivated by recent trends in online advertising and advancements made by online pub- lishers, we consider a new form of contract which allows advertisers to specify the number of unique individuals that should see their ad (reach), and the minimum number of times each individual should be exposed (frequency ). We develop an optimization framework that aims for minimal underdelivery and proper spread of each campaign over its targeted demographics. As well, we introduce a pattern-based delivery mechanism which allows us to integrate a variety of interesting features into which have not been possible before. For example, our approach allows publishers to implement any desired pacing of ads over time at the user level or control the number of competing brands seen by each individual. We develop a two-phase algorithm that employs column generation in a hierarchical scheme with three parallelizable components.

our algorithm produces high-quality solutions and has promising run-time and scalability. Several extensions of the model are presented, e.g., to account for multiple ad positions on the webpage, process.

Organization and Management

Professor Christopher Bauman

Title: “Intentional sin and accidental virtue? Cultural differences in moral systems influence perceived intentionality” Co-authors: Clark, C. J., Kamble, S. V., and Knowles, E. D. Accepted at: Social and Personality Psychological Science

Indians and U.S. Americans view harmful actions as morally wrong, but Indians are more likely than U.S. Americans to perceive helping behaviors as moral imperatives. We utilize this cultural variability in moral belief systems to test perceptions of intentionality (as suggested by Four experiments found that Indians attribute more intentionality than U.S. Americans for helpful but (Studies 2-3). Also, cross-cultural differences in stronger praise motives (Study 3), and stronger devotion to religious beliefs and practices among direct support for the claim that features of moral

Professor Christopher Bauman

Title: “Blame the shepherd not the sheep: Imitating high-ranking transgressors mitigates punishment for unethical behavior” Co-authors: Leigh P. Tost and Madeline Ong Accepted at: Organizational Behavior and Human Decision Processes

theory and psychological theories of blame, we predicted that unethical behavior by higherranking individuals changes how people respond to lower-ranking individuals who subsequently commit the same transgression. Five studies explored when and why this rank-dependent we found that people were less punitive when low-ranking transgressors imitated high-ranking members of their organization. However, imitation only reduced punishment when the two

transgressors were from the same organization (Study 2), when the transgressions were highly similar (Study 3), and when it was unclear whether the initial transgressor was punished (Study actor-observer differences in social learning and identify a way that unethical behavior spreads through organizations.

Professor Luyi Gui

Title: “Design Incentives under Collective Extended Producer Responsibility: A Network Perspective” Co-authors: Atalay Atasu, Ozlem Ergun, Beril Toktay Accepted at: Management Science

A key goal of Extended Producer incentives for producers to design their products in a collective system, where a network of resulting system cost is allocated among these considered to provide inferior design incentives compared to an individual implementation individually). In this paper, we revisit this assertion and investigate its fundamental underpinnings in a network setting. To this end, we develop a new biform game framework that captures cooperative stage) and recognizes the need to maintain the voluntary participation of producers for the collective system to be stable (cooperative stage). This biform game subsumes the networkbased operations of a collective system and product design and participation decisions. We then characterize the manner in which design improvement may compromise stability and vice implementation can match and even surpass an individual implementation with respect to product design outcomes. In particular, we show that when recyclability are substitutes (complements), a recycling network where processor capacity reduction will lead to superior designs in the collective system and maintain its stability, and we propose cost allocation mechanisms to achieve this dual purpose.

Professor Jone Pearce

Title: “Using Organizational Science Research to Address U.S. Federal Agencies’ Management and Labor Needs” Co-authors: Herman Aguinis, Gerald F. Davis, James R. Detert, Mary Ann Glynn, Susan E. Jackson, Tom Kochan, Ellen Ernst Kossek, Carrie Leana, Thomas W. Lee, Elizabeth Morrison, Jeffrey Pfeffer, Denise Rousseau, Kathleen M. Sutcliffe Accepted at: Behavioral Science Policy Journal

We describe important and common management and labor needs across more than Federal Employee Viewpoint Survey (FEVS) and offer evidence-based interventions for addressing them based on organizational science research. Our recommendations have the synergistic goals of improving employee wellbeing, employee productivity, and agency performance and innovation, which will result in increased agency offer suggestions for interventions to improve (a) employee motivation through engagement, communication, and collaboration. We offer be relevant to many agencies, while also being concrete and actionable. We also offer suggestions for associated research that could be conducted in federal agencies interested in these topics.

PhD Candidate Harsh Jha

Title: “A Patchwork of Identities: Emergence of Charter Schools as a New Organizational Form” Co-authors: Christine Beckman Accepted at: Research in the Sociology of Organizations

We examine the emergence of an organizational form, charter schools, in to organizational founding identities using topic founding actors create distinct and consistent identities, whereas more peripheral founders indulge in more unique identity construction. We see the settlement of the form into a stable ecosystem with multiple identity codes rather than driving toward a single organizational identity. The variety of identities that emerge do not always for the conditions under which organizational innovation and experimentation within a new form may develop.

Strategy

Professor Philip Bromiley

Title: “Timing for Dollars: How option exercisability influences resource allocation” Co-authors: David Souder Accepted at: Journal of Management

Stock options have been advocated to encourage managers to make long-run investments like research and development entail upfront costs with the potential to generate favorable long-term returns. However, the effect of options on managerial decisions depends on managerial beliefs about how the stock market evidence, managers believe that stock prices but not CAPX, then stock option exercisability – which dictates when managers can receive allocation. We also consider the effect of changes a study of more than 6,500 observations from show that unexercisable stock options positively not CAPX. Both patterns are consistent with behavior that increases managerial payoffs but underwater options and CAPX but no evidence of sensitive to recent changes in option values.

Professor Philip Bromiley

Title: “A behavioral understanding of investment horizon and firm performance” Co-authors: David Souder, Greg Reilly, and Scott Mitchell, PhD Alumnus Accepted at: Organization Science

emphasize short term results at the expense of long run value. Using a behavioral perspective, we analyze three hypotheses related to this general argument. First, we examine the association of contributing new theory that argues for a quadratic rather than linear association. Second, because the tendency toward immediate results could investment horizons at a level where marginal performance. Measuring horizon as the expected empirical support for the hypothesized quadratic

relation in a large-scale, multi-year sample of U.S. where our models predict increases in horizon the most positive returns occur when long horizon investments are aligned with investor patience.

Professor John Joseph

Title: “Organizational Structure and Performance Feedback: Centralization, Aspirations and Termination Decisions” Co-authors: Ronald Klingebiel and Alex Wilson Accepted at: Organization Science

This study examines the effects of organizational structure and performance feedback on termination decisions – in particular, product phase out. Using quarterly product-level data on the major mobile handset manufacturers product-level feedback affects product phaseout, and how these decisions are conditioned by organizational structure – the extent to which decision making is centralized. We argue that such structure affects termination in two ways: directly through coordination and indirectly by shaping the interpretation of performance feedback. Our baseline models indicate that as performance increases above aspirations, the rate of phase declines below aspirations, the rate of phase out decreases, but then increases when the product effect above aspirations but attenuates it below aspirations. This study links two pillars of the Carnegie school, aspiration levels and hierarchy, to explain the complexity of phase-out following perceived success or failure. We thereby augment the growing scholarship on performance feedback by considering some important conditional effects imposed by a centralized structure. Our focus on centralization expands the scope of theory concerning organization design by linking structure termination decisions.

Professors Margarethe Wiersema and Libby Weber

Title: “Dismissing a Tarnished CEO? Psychological Mechanisms and Unconscious Biases in the Board’s Evaluation” Accepted at: California Management Review

dismissed following corporate misconduct or poor when boards will dismiss the CEOs, as the same behavior often results in different decisions across article explores the factors that lead a CEO to become tarnished. It then uses expectancy

violation theory combined with attribution theory as well as stakeholder theory, concepts of legitimacy, and motivational theory to understand how the board evaluates the tarnished CEO. this paper provides an important contribution to both academic research and to corporate boards who face the responsibility of deciding how to corporate misconduct.

Awards and Honors

Professor Philip Bromiley was elected a

Fellow of the Strategic Management Society.

Professor Imran Currim received the published in European Journal of Marketing 2016.

Professor David Hirshleifer was

elected vice president of the American Finance fellow of the Asian Bureau of Finance and

Professor John Joseph

Professor L. Robin Keller was appointed

to the Committee for a Study of Performance

Professor Terry Shevlin

was awarded the ATA Tax Manuscript Award The Accounting Review