Research Seminars

Do We Want Business Leaders to Be Ethical?

Professor David Mayer
University of Michigan
Wednesday, Dec 10, 2014 at 1:30PM | Room Dean's Conference Room at Owen Graduate School
ABSTRACT

 

Do We Want Business Leaders to Be Ethical?

 

 

The title of this talk presents a simple question with a seemingly obvious answer. Indeed, considerable research has documented the positive benefits of having ethical leaders in business organizations. However, in this talk I present research suggesting the answer to this question may be more complex. Specifically, I highlight my own work demonstrating that we often prioritize competence over morality in business leaders, would prefer to work for a moderately unethical boss than a very ethical boss, and tend to not have ethics in our schema for what it means to be an effective business leader. I conclude by discussing implications for theory and research on moral psychology and behavioral ethics as well as practical implications for organizations seeking to develop ethical cultures.

 

 

Gaguing Return Comovement

Professor David Parsley
Vanderbilt - Owen
Wednesday, Dec 3, 2014 at 1:00PM | Room 216

Interesting Things I Study and the Databases I Use

Professor Paul Chaney
Vanderbilt - Owen
Tuesday, Dec 2, 2014 at 1:00PM | Room 216

Political Uncertainty and Corporate Tax Avoidance: Evidence from National Elections around the World

Professor Richard Willis
Vanderbilt - Owen
Tuesday, Nov 25, 2014 at 1:00PM | Room 216

The Over-Individualization of Culture in Management Research

Professor Ray Friedman
Vanderbilt - Owen
Wednesday, Nov 19, 2014 at 1:00PM | Room 216

The Ethics of Emotional Labour

Professor Bruce Barry
Vanderbilt - Owen
Wednesday, Nov 12, 2014 at 1:00PM | Room 216

The Comovement of Investor Attention

Darren T. Roulstone
Ohio State University
Friday, Nov 7, 2014 at 10:30AM | Room The Centre Building, Room 1

A Labor Capital Asset Pricing Model

Professor Lars-Alexander Kuehn
Tepper School of Business, Carnegie Mellon University
Friday, Oct 24, 2014 at 10:30AM | Room Dean's Conference Room at Owen Graduate School

A Multivariate Analysis of Drivers of Technology Adoption

Mark Ratchford
Vanderbilt - Owen
Wednesday, Oct 22, 2014 at 1:00PM | Room 216

Labor Leverage and Value Spread

Miguel Palacios
Vanderbilt - Owen
Tuesday, Oct 21, 2014 at 1:00PM | Room 216

Pacing work in knowledge intensive services in a non-stationary environment: Goal-gradient, Deadline and Fatigue

Sarang Deo
Indian School of Business
Tuesday, Oct 14, 2014 at 11:20AM | Room 204
ABSTRACT

There is a growing interest in understanding how work pace in service systems is regulated by workload. The main effect, found in lab experiments as well as field studies is that workers speed up in response to high amount of unfinished workload. We contribute to this literature by specifically investigating the role of fixed deadlines and goals associated with the overall workload in regulating work pace. We base our empirical study on a large operational and clinical dataset on patient appointments and visits in the outpatient department of a tertiary eye care hospital. While analyzing the performance across days, we do not find any evidence of speed up or slowdown in response to the goal (anticipated patient load). However, when investigating the performance within a day, we find that work pace increases as the distance to the goal reduces (goal-gradient effect) and as one approaches the end of the day (deadline effect). Further, we find that the goal-gradient effect is stronger closer to the deadline compared to farther from the deadline. In addition, we also uncover a fatigue effect - work pace reduces as the cumulative output increases - attributable to the knowledge intensity of the tasks. These results have implications for designing critical elements of service systems such as the length of the work shift and setting of intermediate goals during the course of a shift.

The Option to Quit: The Effect of Employee Stock Options on Turnover

Paige Ouimet
University of North Carolina at Chapel Hill
Friday, Sep 26, 2014 at 10:30AM | Room Room 218, Owen Graduate School
ABSTRACT

 

Abstract

 

We show that in the years following a large broad-based employee stock option (BBSO) grant, employee turnover falls at the granting firm. We find evidence consistent with a causal relation by exploiting unexpected changes in the value of unvested options. A large fraction of the reduction in turnover appears to be temporary with turnover increasing in the 3

rd year following the year of the adoption of the BBSO plan. We also find that the effect of BBSO plans is larger at market leaders, identified as firms with high industry-adjusted market-to-book ratios, market share or industry-adjusted profit margins, as measured at the time of the grant.

Contracting in the Shadow of the Future

Professor Ranjani Krishnan
Michigan State University
Tuesday, Sep 23, 2014 at 9:40AM | Room TBA
ABSTRACT

 

Contracting in the Shadow of the Future

 

 

ABSTRACT

 

Contract
design involves control mechanisms that trade off the provision of ex
ante
 incentives to reduce losses from moral hazard, while avoiding
costs of ex post adaptations. We examine how this tradeoff
influences the form of the contract, namely cost-plus and fixed-price. We
investigate whether two control mechanisms, i.e., the possibility of a future
horizon, and bilateral reputation capital can mitigate the risk of
cost-inefficiency in cost-plus contracts and adaptation costs in fixed-price
contracts. We analytically show that the attractiveness of a cost-plus
(fixed-price) contract is increasing in (a) task complexity, (b) vendor rent
seeking potential, (c) contracting parties' potential for future business, and
(d) vendor reputation for cost containment (fair bargaining). We test the
model's predictions using contract data collected from the SEC material
contracts database, supplemented with hand-collected data from trade and
industry publications. Results using recursive, simultaneous, bivariate probit
estimations with endogeneity corrections support our predictions.

 

Keywords: Fixed price
contract, cost plus contract, incentives, hold up, relational contract.

 

JEL Classifications:
D23, D86, L14, M41

 

The Volatility Smile in Perfect Markets

Dr. Jay Muthuswamy
Kent State University
Friday, Aug 22, 2014 at 10:30AM | Room Room 218, Owen Graduate School
ABSTRACT

 

Abstract

It is well-known that market prices of options produce implied volatilities that vary by strike in a pattern called the volatility smile. We demonstrate that even if options traded with Black-Scholes-Merton pricing, we would observed smiles, skews, and smirks. This phenomenon arises purely from elements of the computational procedure. We show that elimination of this effect is virtually impossible and that it becomes even more difficult to account for it when volatility smiles also reflect market imperfections, as it is commonly thought. We empirically estimate that the lower bound of this effect is about 18% of the market-observed smile.

Coordinating Cross-Boundary Care Transitions

Brian Hilligos
Ohio State University
Friday, Apr 25, 2014 at 12:00PM | Room 206E (Dean's Conference Room)

Owen Faculty Research Seminar

Debra C. Jeter
Vanderbilt University
Tuesday, Apr 22, 2014 at 1:00PM | Room 216

"Are SPDRs creepy? How your Exchange Traded Fund is like Facebook."

Jesse A. Blocher
Vanderbilt University
Wednesday, Apr 16, 2014 at 1:00PM | Room 216

If You Can’t Do It, Study It: But Honestly, I’m Not Lonely! (Two Projects that Explore the Effects of Celebrity Endorsements and Narrative Ads on Lonely Consumers)

Jennifer E. Escalas
Vanderbilt University
Tuesday, Apr 15, 2014 at 1:00PM | Room 216

Who Consumes Firm Disclosures? Evidence from Public Conference Calls

Eugene Soltes
Harvard Business School
Wednesday, Apr 9, 2014 at 2:00PM | Room 230 Owen Graduate School

I Get So Emotional: Bringing Individuals Back Into High-Reliability Organizations

Timothy J. Vogus
Vanderbilt University
Tuesday, Apr 8, 2014 at 1:00PM | Room 216

Empirical Investigation of the Competitive and Collaborative Implications of Category Captainship

Mumin Kurtulus
Vanderbilt University
Wednesday, Apr 2, 2014 at 1:00PM | Room 216

Competitive Action from a Behavioral Strategy Perspective

Brian McCann
Vanderbilt University
Tuesday, Apr 1, 2014 at 1:00PM | Room 216

Vice Virtue Bundles

Kelly Haws
Vanderbilt University
Wednesday, Mar 26, 2014 at 1:00PM | Room 216

Minding the Obvious

Rangaraj Ramanujam
Vanderbilt University
Tuesday, Mar 25, 2014 at 1:00PM | Room 216

Unraveling the Black Box of Cost Behavior: An Empirical Investigation of Risk Drivers, Managerial Resource Procurement, and Cost Flexibility

Professor Ranjani Krishnan
Michigan State University
Friday, Mar 21, 2014 at 10:30AM | Room Dean's Conference Room

How Fast Should a Cash-Constrained Firm Grow? Inventory Policies That Balance Growth and Survival

Yasin Alan
Vanderbilt University
Tuesday, Mar 18, 2014 at 1:00PM | Room 216

Fiscal Policy and the Distribution of Consumption Risk

Mac Croce
University of North Carolina
Wednesday, Mar 12, 2014 at 10:30AM | Room 106

A Taxonomy of Manufacturer-Retailer Competition

Luke Froeb
Vanderbilt University
Wednesday, Mar 12, 2014 at 1:00PM | Room 216

Models for Customer Share of Wallet

Bruce Cooil
Vanderbilt University
Tuesday, Mar 11, 2014 at 1:00PM | Room 216

Relative Prices, Payer Mix and Regional Variations in Medical Care

Sean Nicholson
Cornell University
Monday, Mar 10, 2014 at 1:00PM | Room 206E
ABSTRACT
Abstract: The use of medical services and Medicare spending vary substantially across geographic regions of the United States, as documented by Dartmouth Atlas researchers over the past four decades. We measure the extent to which regional variations in Medicare spending on physician services is due to regional variations in the generosity of Medicare relative to private insurance prices. We take advantage of exogenous changes in Medicare reimbursement rates for physician services to estimate the relationship between Medicare reimbursement, private insurance prices for physician services, and Medicare utilization and spending. We find that a one-percent increase in Medicare reimbursement for a given service corresponds to a 0.46 increase in private prices for the same service and a 0.15 percent increase in the supply of that service to Medicare patients. These results are consistent with a model where physicians alter private prices in order to achieve an optimal mix of privately-insured and Medicare patients. The resulting difference in the payer mix of patients across regions creates cross-regional variation in Medicare spending. We predict that about one-sixth of the geographic variation in medical spending can be explained by variations in Medicare profit. 

Stakeholder Reliance on Audited Reports, Audit Fees, and Auditor Litigation Risk

Michael Drake
Brigham Young University
Friday, Feb 21, 2014 at 10:30AM | Room 218
ABSTRACT
Abstract: We build on findings in Badertscher et al. (2014) by providing evidence that the number of stakeholder relying on audited financial reports impacts auditors‟ litigation exposure. Specifically, using multiple proxies for stakeholder reliance, we find a positive association between the extent of stakeholder reliance and audit fees. Additional tests corroborate our inference that the association between audit fees and stakeholder reliance is related to litigation risk. The importance of improving our understanding of auditors‟ sensitivity to factors that increase litigation exposure is highlighted by the number and magnitude of lawsuits filed against auditors relating to the audits of public clients. 

A Different Look at Inequality and Mobility in the U.S.

Miguel Palacios
Vanderbilt University
Tuesday, Feb 18, 2014 at 1:00PM | Room 216

Does Market Incompleteness Matter for Market Microstructure?

Francois Cocquemas
Visiting Scholar, Owen Graduate School of Management
Friday, Feb 14, 2014 at 10:30AM | Room 218
ABSTRACT
Abstract

Market incompleteness should matter in theory, but it is difficult to identify and measure the magnitude of its effects, especially on market microstructure. We use a natural experiment at the Tel Aviv Stock Exchange (TASE) to analyze how order submission patterns, trading and hedging strategies, and overall market impact are affected by market incompleteness. Options on the dollar are traded on Sundays on the TASE, while their underlying is not, which we use in a difference-in-differences setting with options on the equity index as control.

Overall, our evidence suggests that market incompleteness has two majors effects on traders behaviors. First, likely because of expected higher adverse selection, traders change their patterns, resorting to higher strategic order splitting, nonetheless somewhat reducing their overall trading volumes. Second, because of actually lower information caused by the spot market closure, prices are in fact more efficient and volatility is lower, and aggregate trading costs during periods of incompleteness are slightly reduced, suggesting that informed trading plays a lesser role.

Keywords: market incompleteness, market microstructure, liquidity, options.
JEL codes: C23, D52, D47, G14, G12.

 

Fair Pay Allocations: from a Regulatory Focus Theory View

Tae-Youn Park
Vanderbilt University
Thursday, Feb 13, 2014 at 1:00PM | Room 216

Short Sellers and the Informativeness of Stock Prices with Respect to Future Earnings

Michael Stuart
Vanderbilt University
Wednesday, Feb 12, 2014 at 1:00PM | Room 216

The Impact of Environmental Regulation on Firm Competitiveness: A Meta-Analysis of the Porter Hypothesis

Mark Cohen
Vanderbilt University
Tuesday, Feb 11, 2014 at 1:00PM | Room 216

ENABLE: Efficient Novel Active Behavioral Levers

Punam Anand Keller
Tuck School, Dartmouth College
Friday, Feb 7, 2014 at 10:00AM | Room Dean's Conference Room
ABSTRACT

ENABLE interventions combine health communication, marketing, and choice architecture to increase active participation in initiating healthy behaviors. The ENABLE guidelines can be used with or without financial incentives to enroll in health programs. Support for ENABLE is obtained in six field studies. Three studies demonstrate how ENABLE can enhance enrollment in programs that do not offer financial incentives. Three additional studies show how ENABLE can increase enrollment in programs without adding to existing financial incentives.   

 

Early Stage Work on Radically New Products

Steve Hoeffler
Vanderbilt University
Wednesday, Feb 5, 2014 at 1:00PM | Room 216

Venture Capital and Career Concerns

Nicholas Crain
Vanderbilt University
Tuesday, Feb 4, 2014 at 1:00PM | Room 216

Mergers When Prices Are Negotiated: Evidence From the Hospital Industry

Gautam Gowrisankaran
Eller College of Management, University of Arizona
Monday, Feb 3, 2014 at 11:15AM | Room 216
ABSTRACT

 We estimate a bargaining model of competition between hospitals and managed care organizations (MCOs) and use the estimates to evaluate the effects of hospital mergers. We find that MCO bargaining restrains hospital prices significantly. The model demonstrates the potential impact of coinsurance rates, which allow MCOs to partly steer patients towards cheaper hospitals. We show that increasing patient coinsurance tenfold would reduce prices by 16%. We find that a proposed hospital acquisition in Northern Virginia that was challenged by the Federal Trade Commission would have significantly raised hospital prices. Remedies based on separate bargaining do not alleviate the price increases.

Resource Accumulation Through Economic Ties: Evidence from Venture Capital

Yael Hochberg
Massachusetts Institute of Technology and NBER
Friday, Jan 31, 2014 at 10:30AM | Room 218
ABSTRACT
Abstract
Ties between similar partners observed in economic and nancial networks are often attributed to concerns about agency costs. In this paper, we distinguish the underlying motives for tie formation between sets of potential partners in the network, thus informing the relative importance of agency cost and resource accumulation in tie formation across rms. We develop a robust and generalizable methodology that allows for the inference of similarity and/or cumulative advantage motives in the potential presence of resource trading. We estimate the model using venture capital co-investment networks, employing factor analysis to characterize orthogonal, interpretable resources for VC rms. In the VC setting, value-added resources other than capital appear to be exchanged for capital, but not for one another. We find little evidence for similarity motives as the primary driver of matching, suggesting that concerns over agency conflicts in partnering are dominated by the desire to accumulate higher levels of certain resources.
 

Cyclicality, Performance Measurement, and Cash Flow Liquidity in Private Equity

Berk Sensoy
Ohio State University
Friday, Jan 17, 2014 at 10:30PM | Room 218
ABSTRACT
Abstract
This paper takes a new approach towards understanding the risk/return tradeoff
that investors to private equity face when they invest in private equity partnerships. We study the sensitivity of private equity cash flows to business cycle and market conditions using a new large dataset of cash flows to 837 buyout and venture capital funds from 1984-2010. Buyout has outperformed the S&P 500 by 18% on average over the life of the fund, while venture capital has underperformed since at least the late 1990s. Most cash flow variation at a point in time is diversifiable – either idiosyncratic to a given fund or explained by the fund’s age. Both capital calls and distributions also have a systematic component that is procyclical on average. Distributions are more sensitive than calls, implying procyclical aggregate net cash flows. A consequence is that the well-known finding that funds raised in hot markets underperform in absolute terms is sharply attenuated when comparing to public equities. Consistent with a liquidity premium for calling capital in bad times, we find that funds with a relatively high propensity to do so perform better in both absolute and relative terms. Venture capital cash flows and performance are considerably more cyclical than buyout, and the links between cyclical cash flows and performance are likewise stronger.