Authors:  Dahee Han, Ashok K. Lalwani and Adam Duhachek

Publication: Journal of Consumer Research, Vol. 44, No. 1, June 2017

Abstract:

Three studies examine the relation between power distance belief (PDB), the tendency to accept and expect inequalities in society; power, the control one has over valued resources; and charitable giving. Results suggest that the effect of PDB depends on the power held by the donor. In low-PDB contexts, people high (vs. low) in psychological power tend to be more self-focused (vs. other-focused), and this leads them to be less charitable. In high-PDB contexts, however, people high (vs. low) in psychological power tend to be more other-focused (vs. self-focused), and this leads them to be more charitable. The authors also explore several boundary conditions for these relationships and conclude with the implications of these findings.

Read full article: Journal of Consumer Research

Classified as: Marketing, Journal of Consumer Research, Desautels 22
Category:
Published on: 17 Oct 2017

Authors: Peter Christoffersen, Ruslan Goyenko, Kris Jacobs, Mehdi Karoui

Publication: Review of Financial Studies, Vol. 31, No. 3, March 2018

Abstract:

Standard option valuation models leave no room for option illiquidity premia. Yet we find the risk-adjusted return spread for illiquid over liquid equity options is 3:4% per day for at-the-money calls and 2:5% for at-the-money puts. These premia are computed using option illiquidity measures constructed from intraday effective spreads for a large panel of U.S. equities, and they are robust to different empirical implementations. Our findings are consistent with evidence that market makers in the equity options market hold large and risky net long positions, and positive illiquidity premia compensate them for the risks and costs of these positions.

Read full article: Review of Financial Studies

Classified as: Ruslan Goyenko, finance, Review of Financial Studies, Desautels 22
Category:
Published on: 17 Oct 2017

The Swiss Finance Institute (SFI) has attributed its Outstanding Paper Award to "The Blockchain Folk Theorem," a research paper by Bruno Biais, Toulouse School of Economics, Christophe Bisière, Toulouse School of Economics, Matthieu Bouvard, McGill University, and Catherine Casamatta, Toulouse School of Economics, that investigates the stability of the blockchain protocol in a game-theoretic approach.

Classified as: Matthieu Bouvard, finance
Category:
Published on: 13 Oct 2017

Authors: David Schumacher

Publication: Review of Financial Studies, Forthcoming

Abstract:

Classified as: David Schumacher, finance
Category:
Published on: 11 Oct 2017

Authors: Robert Engle, Guillaume Roussellet, Emil Siriwardane

Publication: Journal of Econometrics, Vol. 201, No. 2, December 2017

Abstract:

Classified as: Guillaume Roussellet, finance
Category:
Published on: 3 Oct 2017

Authors: Alain Monfort, Fulvio Pegoraro, Jean-Paul Renne and Guillaume Roussellet

Publication: Journal of Econometrics, Vol. 201, No. 2, 2017, pp. 348-366.

Abstract:

Classified as: Guillaume Roussellet, finance
Category:
Published on: 2 Oct 2017

Author: MaryJane Rabier 

Publication: The Accounting Review, Vol. 93, No. 1, 2018, pp. 335-362

Abstract:

Gupta and Gerchek (2002) argue that different acquirers can arrive at different equity valuations for the same target depending on their strategic intent. A reason for acquirers' equity valuations to vary, holding target fundamentals constant, may be that individual acquirers place different weights on underlying fundamentals. I examine this possibility using Burgstahler and Dichev (1997)'s theoretical framework. They argue that the relative importance of earnings and book value depends on expected adaptation, which is the likelihood that the existing earnings generating process will be altered. Using restructuring costs to proxy for expected adaptation at the individual acquirer level, I find that the association between the target's earnings (book value) and acquirers' bid prices is decreasing (increasing) in expected adaptation, consistent with theoretical predictions. These findings are less pronounced during merger waves and intense bid competition for the target.

Read full article: The Accounting Review

Classified as: maryjane rabier, Accounting, The Accounting Review, Desautels 22
Category:
Published on: 28 Sep 2017

Author: MaryJane Rabier

Publication: Strategic Management Journal, Vol. 38, No. 13, 2017

Abstract

Research summary:

I examine how acquisition motives relate to the distribution of post-acquisition performance. I argue that acquisitions motivated by operating synergies have the potential to experience greater gains than acquisitions driven by financial synergies but are harder to value and implement, making them more uncertain. Using SEC filings, conference calls and press releases to capture acquisition motives, I find that acquirers pursuing operating synergies are more likely to experience highly positive and highly negative long-term returns than acquirers pursuing financial synergies.

I also find that acquisition experience and geographic proximity to targets soften acquirers' extreme downside outcomes in operating synergy acquisitions. My theory and results suggest that approaches that emphasize average outcomes for acquirers and use industry classifications to capture acquisition motives may be incomplete.

Managerial summary

Managers engage in acquisitions for various reasons. In this study, I find that reasons related to operating synergies (e.g., revenue growth through new product offerings or cost savings through economies of scale) are more likely to result in extreme high and low performance outcomes for the acquiring firm compared to reasons related to financial synergies (e.g., diversification of cash flow streams).

In addition, I find that the acquirer's prior acquisition experience and the geographic proximity between the target and acquirer help soften the extreme low performance outcomes related to operating synergies. 

Read full article: Strategic Management Journal

Classified as: maryjane rabier, Accounting, Strategic Management Journal, Desautels 22
Category:
Published on: 28 Sep 2017

Saurabh Mishra, Associate Professor in Marketing, has been appointed to the Editorial Review Board of the Journal of the Academy of Marketing Science (JAMS).

JAMS is devoted to the study and improvement of marketing and serves as a vital link between scholarly research and practice by publishing research-based articles in the substantive domain of marketing.

Classified as: Saurabh Mishra, Marketing
Category:
Published on: 17 Aug 2017

Authors: Pedro Piccolia, Mo Chaudhury, Alceu Souza and Wesley Vieirada Silvaa

Publication: The North American Journal of Economics and Finance, Vol. 41, July 2017

Abstract:

The paper investigates the behavior of individual US stocks during the 21 trading days following the event of extreme movement in the market index on a day.

Classified as: finance
Category:
Published on: 17 Aug 2017

Authors: Anand Kumar, Debjit Roy, Vedat Verter and Dheeraj Sharma

Publication: European Journal of Operational Research, Vol 264, No. 1, January 2018

Abstract:

Classified as: Vedat Verter, operations management
Category:
Published on: 10 Aug 2017

Authors: Florian Hoos,  Jorien Louise Pruijssers, Michel W. Lander

Publication: Journal of Business Ethics, Forthcoming

Abstract:

Classified as: Jorien Pruijssers, Accounting
Category:
Published on: 12 Jul 2017

Authors: Jan Ericsson, Xiao Huang, Stefano Mazzotta

Publication: Journal of Empirical Finance, Volume 38, Part A, September 2016, Pages 1-21

Abstract:

Classified as: finance, Jan Ericsson
Category:
Published on: 12 Jul 2017

Authors: Saied Samiedaluie, Beste Kucukyazici, Vedat Verter, Dan Zhang

Publication: Operations Journal

Abstract:

Classified as: Vedat Verter, Beste Kucukyazici, operations management
Category:
Published on: 3 Jul 2017

Authors: Fahri Karakas and Emine Sarigöllü

Publication: Journal of Business Ethics, Forthcoming

Abstract:

Classified as: Emine Sarigollu, Marketing
Category:
Published on: 26 Jun 2017

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