Research News

Haskayne Research

Popular stock market strategy victim of rise of knowledge economy

‘Recent demise’ of value investing actually happened 30 years ago

Buyer beware: How Libra differs from Bitcoin

Alfred Lehar, Haskayne School of Business, writing in Conversation Canada

Corporate social responsibility pays off for companies, Haskayne researcher finds

Co-author of study Yrjo Koskinen says initiatives aren’t simply about being nice guys

National disaster risk financing plan seen as vital for Canadians

Canada only G7 nation not to back insurance industry during ‘mega catastrophes’

Recent Top Journal Articles

Forthcoming

Corporate Social Responsibility and Firm Risk: Theory and Empirical Evidence

Journal: Management Science (Eyes High Star, FT50, AJG 4*)

Authors: Rui Albuquerque, Yrjo Koskinen, Chendi Zhang

  • The authors model Corporate Social Responsibility (CSR) initiatives as a product differentiation strategy that allows firms to benefit from higher profit margins.
  • Higher profit margins reduce cyclicality of profits, and result in decreased betas (systematic risks) and increased corporate valuations.
  • The authors find supporting evidence analyzing a panel of U.S. firms from 2003 to 2015. Results are stronger for firms with high advertising expenditures.

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Forthcoming

Market Segmentation and Software Security: Pricing Patching Rights

Journal: Management Science (Eyes High Star, FT50, AJG 4*)

Authors: Terrence August, Duy Dao, Kihoon Kim

  • The patching approach to security in the software industry (wherein consumers can decide whether to apply security updates or not) lacks the incentive structure to induce better security-related decisions.
  • Software vendors can differentiate their products based on the provision of patching rights.
  • The optimal pricing of these rights can segment the market in a manner that leads to both greater security and greater profitability.

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Forthcoming

Provisioning Interoperable Disaster Management Systems: Integrated, Unified, and Federated Approaches

Journal: MIS Quarterly (Eyes High Star, FT50, AJG 4*)

Authors: Hong Guo, Yipeng Liu, Barrie R. Nault

  • Resource interoperability is key to districts sharing resources effectively.
  • Tension is between technology fit for a given district and interoperability with other districts.
  • Incentives can be used to motivate the collectively optimal interoperability approach.

 

Forthcoming

Chinese Multinationals’ Fast Internationalization: Financial Performance Advantage in One Region, Disadvantage in Another

Journal: Journal of International Business Studies (Eyes High Star, FT50, AJG 4*)

Authors: Heechun Kim, Jie Wu, Douglas A. Schuler, Robert E. Hoskisson

  • Top managers should consider together both the speed and geographic space of internationalization.
  • Top managers are advised to rapidly venture into and focus on intra-regional host countries, where they can utilize their home-grown firm-specific advantages, including technological and marketing resources.
  • Top managers should be cautious when rapidly expanding into inter-regional host countries, not only because they may have difficulty transferring home-grown firm-specific advantages successfully, but also because it is challenging to address large differences across inter-regional host countries.

 

Forthcoming

Balancing openness and prioritization in a two-tier Internet

Journal: Information Systems Research (Eyes High Star, FT50, AJG 4*)

Authors: Barrie R. Nault, Steffen Zimmermann

  • The authors develop a model to determine the impact of a two-tier Internet—including the current open Internet and a co-existing fee-based fast-lane Internet—on overall welfare.
  • Their model examines edge provider (such as Amazon or Netflix) conversion to a fast lane, broadband provider’s investment and pricing, and a straightforward policy mechanism to balance openness and prioritization in a way that the general quality of the open Internet does not suffer.
  • Results demonstrate that to maintain the quality of service of the open Internet and increase social welfare, a two-tier Internet must be coupled with a policy mechanism, whereby a portion of broadband provider profit is invested in Internet capacity.

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Forthcoming

The Strategic Value of IT in Setting Productive Capacity

Journal: Information Systems Research (Eyes High Star, FT50, AJG 4*)

Authors: Dawei Zhang, Barrie R. Nault, Xueqi (David) Wei

  • The authors examine how information technology (IT) can contribute to a strategy of holding excess capacity by comparing the relationship between IT capital and capacity with that of non-IT capital and capacity.
  • Using production theory-based empirical analyses, they find that increases in IT capital yield an almost four-fold greater expansion in capacity than do increases in non-IT capital.
  • Thus, as both types of capital are constraints on capacity, for a strategy of holding excess capacity, IT capital is a more valuable constraint to relax than non-IT capital.

 

December 2019

The Structural Reshaping of Globalization: Implications for Strategic Sectors, Profiting from Innovation, and the Multinational Enterprise

Journal: Journal of International Business Studies, 50th Anniversary Special Issue “Changing the world: How international business research makes a difference (Eyes High Star, FT50, AJG 4*)

Authors: Olga Petricevic, David J. Teece

 

May 2019

Imperfect Renegotiations in Interbank Financial Networks

Journal: Management Science, 65(5), 2342–2359. (Eyes High Star, FT50, AJG 4*)

Authors: Alexander David, Alfred Lehar

  • Interbank financial networks enable banks to share the risks in their assets but potentially also increase systemic spillovers of insolvency from one bank to others in the network.
  • The authors model a renegotiation game to explicitly examine the forgiveness of commitments of insolvent banks by solvent banks to limit the systemic transmission of financial distress.
  • The authors also show how banks can ex ante optimally construct networks from interbank loans and derivatives to minimize the costs of such inefficient financial distress.

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May 2019

The cross-section of labor leverage and equity returns

Journal: Journal of Financial Economics, 132(2), 497–518. (Eyes High Star, FT50, AJG 4*)

Authors: Andres Donangelo A, François Gourio, Matthias Kehrig, Miguel Palacios

  • The authors’ model provides theoretical support for the use of firm-level labour share as a measure of labour leverage, which represents a form of operational leverage related to the relative size and inflexibility of labour expenses.
  • In firms where labour takes a high share of revenues, operating profits are more sensitive to economic shocks and have higher expected returns. Thus, labour leverage works in the same way as financial leverage.
  • Practitioners should take this into account in assessing a firm’s riskiness and cost of capital, and in estimating the expected returns of appropriately formed portfolios.

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April 2019

Exploration Activity, Long-Run Decisions, and the Risk Premium in Energy Futures

Journal: Review of Financial Studies, 32(4), 1536–1572. (Eyes High Star, FT50, AJG 4*)

Author: Alexander David

  • The author provides a new equilibrium model of drilling, exploration and storage to understand how investment by oil firms positively affects the futures basis and negatively predicts excess returns on crude oil futures.
  • Drilled wells produce the resource at geometrically declining rates; however, under the assumption that the level of consumers’ habit equals the production from all previously drilled wells, the futures basis and risk premium are only related to drilling, investment and inventory.
  • Investment leads to a more elastic drilling response by firms and dampens oil price increases from demand shocks, thus lowering the risk premium. A higher investment lowers extraction costs as firms drill in increasingly expensive fields.

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December 2018

The Kogut and Singh national cultural distance index: Time to start using it as a springboard rather than a crutch

Journal: Journal of International Business Studies, 49(9), 1154–1166. (Eyes High Star, FT50, AJG 4*)

Authors: Robbert Maseland, Douglas Dow, Piers Steel

  • In this counterpoint article, the authors investigate the continued relevance of the 30-year-old Kogut and Singh (KS) index of cultural distance in international business.
  • The KS index was a seminal contribution to the literature, but the subsequent stream of research failed to build on it to develop more precise and insightful theories as to when, how, and why cross-national differences matter, or more effective and relevant techniques with which to operationalize the distance constructs.
  • The authors call for more theoretically informed approaches, highlighting the underlying mechanisms, and specifying which data and algorithms best capture those mechanisms in each research context.

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December 2018

Decomposing the Variance of Consumer Ratings and the Impact on Price and Demand

Journal: Information Systems Research, 29(4), 984–1002. (Eyes High Star, FT50, AJG 4*)

Authors: Steffen Zimmermann, Philipp Herrmann, Dennis Kundisch, Barrie R. Nault 

  • The authors develop and test a model where both taste and quality differences may cause variance in consumer ratings.
  • A higher variance caused by taste differences indicates that a product closely matches the tastes of some consumers and less closely matches the tastes of others, resulting in a higher price and lower demand. A higher variance caused by quality differences suggests an unreliable product and is therefore associated with a lower price and lower demand.
  • Counter to intuition, risk-averse consumers may prefer a higher-priced product with a higher variance in ratings when deciding between two similar products with the same average rating.

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Forthcoming

Delegation of Stocking Decisions under Asymmetric Demand Information

Journal: Manufacturing & Service Operations Management. (Eyes High, FT50, AJG 3)

Authors: Osman Alp, Alper Sen

  • Inventory replenishment decisions for retail chains are commonly made at their headquarters; this practice neglects information that individual store managers have about local demand and volume.
  • Inventory replenishment decisions could be delegated to local store managers, but there is no incentive for them to make decisions that align with headquarters’ interests.
  • A proposed new method that blends new Key Performance Indicators into the performance scorecard of store managers could lead to significant savings, boost customer service levels and provide competitive advantage over rival businesses.

 

Forthcoming

Corporate Diplomacy and Family Firm Longevity

Journal: Entrepreneurship Theory and Practice (Eyes High, FT50, AJG 4)

Authors: Luciano Ciravegna, Liena Kano, Francesco Rattalino, Alain Verbeke

  • The authors discuss family firm longevity building upon a new conceptual lens, informed by transaction cost economics (TCE), but augmented with corporate diplomacy thinking.
  • Corporate diplomacy, through its three process steps—familiarization, acceptance and engagement—can help the family firm augment its baseline reservoir of social capital, and allows improved economizing on contracting challenges that endanger its survival.
  • Family firms that focus on corporate diplomacy processes and the resulting social capital creation greatly improve their chances of longevity.

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Forthcoming

Abusive Supervision Differentiation and Employee Outcomes: The Roles of Envy, Resentment, and Insecure Group Attachment

Journal: Journal of Management (Eyes High, FT50, AJG 4*)

Authors: Babatunde Ogunfowora, Justin M. Weinhardt, Christine C. Hwang

  • When managers habitually abuse some team members but not others, feelings of envy and resentment ultimately lead to psychological distress, unethical work behaviours and intentions to quit among all team members.
  • Organizations should clearly establish zero tolerance for general abusive behaviour by managers and explicitly discourage managers from selectively abusing certain employees, possibly tying managerial performance to “no abuse” compensation systems.
  • Organizations should also implement training that helps managers to be mindful of situations where they may, unwittingly or knowingly, justify their abuse of certain team members.

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Forthcoming

Improving the Measures of Real Earnings Management

Journal: Review of Accounting Studies (Eyes High, FT50, AJG 4)

Author: Anup Srivastava

  • Firms in the same industry could differ in competitive strategy and use different amounts of intangibles in their business models. Thus, it is wrong to assume that same-industry firms have the same cost structures and that any deviations from industry peers represent a firm’s opportunistic or abnormal behaviour.
  • Deviations in a firm’s financial characteristics compared to its industry peers could reflect the firm’s competitive strategy.
  • The author shows how to control for firm’s competitive strategy in detecting a firm’s opportunistic behaviour.

 

Forthcoming

Five Configurations of Opportunism in International Market Entry

Journal: Journal of Management Studies (Eyes High, FT50, AJG 4)

Authors: Alain Verbeke, Luciano Ciravegna, Luis E. Lopez, Sumit K. Kundu

  • The authors investigate the conditions under which opportunism occurs in international market entry by studying five variables affecting opportunistic behaviour: managerial experience, market entry share, market distance, young age, and network size.
  • While no single variable on its own is associated with opportunism, in concert the five variables form five configurations of opportunism.
  • The study establishes a much-needed bridge between scholarly work based on Transaction Cost Economics, which assumes opportunism as a default behavioural trait, and the practical needs of managers to anticipate and mitigate the effects of deceitful behaviour in international market entries.

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August 2019

Optimal Consumption and Investment under Time-Varying Liquidity Constraints

Journal: Journal of Financial and Quantitative Analysis, 54(4), 1643–1681. (Eyes High, FT50, AJG 4)

Authors: Seryoong Ahn, Kyoung Jin Choi, Byung Hwa Lim

  • The authors study households' consumption and investment decisions given realistic time-varying constraints on borrowing (e.g., debt-to-income ratio constraint and loan-to-value ratio constraint)
  • The resulting implications for households' behaviour differ considerably from those obtained in the existing literature based on fixed borrowing limits, but are consistent with those documented in the empirical literature.
  • This work aims to provide a workhorse model for the individual investor’s investment and consumption behaviour with realistic features on credit and borrowing.

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April 2019

Proximity to a Traditional Physical Store: The Effects of Mitigating Online Disutility Costs

Journal: Production and Operations Management, 28(4), 1033–1051. (Eyes High, FT50, AJG 4)

Authors: Barrie R. Nault, Mohammad S. Rahman

  • The authors examine competition between dual-channel retailers and online stores (e-tailers) when having a traditional physical store can mitigate the online disutility costs that consumers incur when purchasing online.
  • This analysis can help traditional–turned–dual-channel retailers comprehend when and how different types of market structures benefit them when trying to strategically leverage their physical locations.
  • Along the same lines, this analysis provides guidance to pure e-tailers about when to seek linkages with physical locations.

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January 2019

Object valuation and non-ownership possession: how renting and borrowing impact willingness-to-pay

Journal: Journal of the Academy of Marketing Science, 47(1), 97–117. (Eyes High, FT50, AJG 4*)

Authors: Charan K. Bagga, Neil Bendle, June Cotte 

  • The paper presents evidence from four studies on how object valuation (willingness-to-pay) varies for non-ownership possession types (i.e., renting, borrowing and non-possession).
  • The research finds that valuation for rented objects is greater than valuation for non-possessed or borrowed objects.
  • The paper also examines whether the hedonic or utilitarian nature of the product or consumers’ tightwad/spendthrift tendency moderates the reported effects.

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October 2018

The Effects of Linguistic Devices on Consumer Information Processing and Persuasion: A Language Complexity x Processing Mode Framework

Journal: Journal of Consumer Psychology, 28(4), 689–711. (Eyes High, FT50, AJG 4*)

Authors: Ruth Pogacar, L.J. Shrum, Tina M. Lowrey

  • Communicators use linguistic devices, e.g., metaphors, rhymes, alliteration, rhetorical questions, etc., to make their claims more persuasive.
  • The authors introduce an organizing framework to classify linguistic devices based on two continuous dimensions: language complexity, ranging from simple to complex; and processing mode, ranging from automatic (effortless) to controlled (requiring intentional cognitive capacity).
  • The authors then determine the conditions when the linguistic devices are most effective.

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June 2019

Computational Modeling of Entrepreneurship Grounded in Austrian Economics: Insights for strategic entrepreneurship and the opportunity debate

Journal: Strategic Entrepreneurship Journal, 13(2), 221–240. (FT50, AJG 4)

Author: Mohammad Keyhani

  • This paper looks at the implications for strategic entrepreneurship when modelled on the foundations of an Austrian economics logic in a way that integrates into existing economic logics of strategy and competitive advantage.
  • The Austrian economics logic highlights the role of disequilibrium, creative imagination, time and uncertainty, while the traditional economic logic emphasizes the importance of structural sustainable advantages in equilibrium.
  • In this integrative view, even if a firm does not enjoy any competitive advantage over rivals, opportunities for profit or development of competitive advantage still exist through entrepreneurial action.

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June 2019

Socioemotional Favoritism: Evidence from Foreign Divestitures in Family Multinationals

Journal: Organization Studies, 40(6), 917–940. (FT50, AJG 4)

Authors: Heechun Kim, Robert E. Hoskisson, J. Daniel Zyung

  • The authors study a psychological barrier to organizational change during difficult times through divestiture. Termed ‘socioemotional favouritism’, this barrier reflects a “this is ours” mentality.
  • Family CEOs of family multinational enterprises (FMNEs) are found to be less likely to divest foreign subsidiaries than non-family CEOs, particular those in host countries where families have already lost ownership of other subsidiaries through past divestitures.
  • Non-family CEOs, who are less emotionally attached to their FMNEs, tend to make more change-inducing divestiture decisions during difficult times, showing that CEOs are not equally resistant to change.

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March 2019

The Mind is Willing, but the Situation Constrains: Why and When Leader Conscientiousness Relates to Ethical Leadership

Journal: Journal of Business Ethics, 155(1), 75–89. (FT50, AJG 3)

Authors: Mayowa T. Babalola, Michelle C. Bligh, Babatunde Ogunfowora, Liang Guo, Omale A. Garba

  • The authors examine the roles of leader moral reflectiveness and decision-making autonomy in order to better understand the relationship between leader conscientiousness and ethical leadership.
  • Results show that leader conscientiousness is positively related to leader moral reflectiveness, which, in turn, is positively associated with employees’ assessment of ethical leadership. Leader decision-making autonomy moderates the indirect path from leader conscientiousness to ethical leadership through moral reflectiveness.
  • Theoretical and practical implications of these findings are presented, as well as suggestions for ways in which organizations can better foster ethical leadership.

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February 2019

The effects of personality on job satisfaction and life satisfaction: A meta-analytic investigation accounting for bandwidth–fidelity and commensurability

Journal: Human Relations, 72(2), 217–247. (FT50, AJG 4)

Authors: Piers Steel, Joseph Schmidt, Frank Bosco, Krista Uggerslev

  • The authors conducted the world’s largest meta-analysis thus far to study to what extent satisfaction with life as a whole is shaped by satisfaction with your job and your personality.
  • The ability to explain life satisfaction was about double previous attempts, largely due to examining specific elements of personality. Altruism, for example, helps a happy life.
  • Against popular wisdom, people can be highly satisfied with their lives despite having unsatisfying jobs.

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December 2018

I Love That Company: Look How Ethical, Prominent, and Efficacious It Is: A Triadic Organizational Reputation (TOR) Scale

Journal: Journal of Business Ethics, 153(3), 889–910. (FT50, AJG 3)

Authors: James Agarwal, Madelynn Stackhouse, Oleksiy Osiyevskyy

  • A major obstacle to the advancement to research on organizational reputation is the lack of consensus on how the construct should be conceptualized and methodologically operationalized.
  • This research presents a refinement of the organizational reputation construct with the aim of reconciling divergent conceptual and methodological operationalizations of the term.
  • The authors propose and provide support for a triadic organizational reputation model that is relevant for all stakeholders and empirically develop a short, nine-item organizational reputation scale for customers-as-stakeholders based on three dimensions: product and service efficacy, market prominence and societal ethicality. These dimensions, at the core, are reflections of the ‘organizational character’ that serves as halo mechanisms in guiding customer attitude and behaviour.

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December 2018

We Have Never Been Secular: Religious Identities, Duties, and Ethics in Audit Practice

Journal: Journal of Business Ethics, 153(4), 1121–1142. (FT50, AJG 3)

Authors: Jeff Everett, Constance Friesen, Dean Neu, Abu Shiraz Rahaman

  • The authors adopt a perspective of economic theology to examine a case of audit practice involving public corruption in a government program aimed at protecting national identity.
  • They examine the religious identities of auditors, their duties, and their sacred ethics, noting that in cases involving the protection of the sacred notion of country, auditors appear willing to make sacrifices when these are deemed necessary by the principals who have authority over them.
  • They present a discussion of the utility of this framework and its implications for the issues of auditor independence and the public interest.

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August 21, 2019

No, WeWork Isn’t a Tech Company. Here’s Why That Matters

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Anup Srivastava

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August 16, 2019

The Gap Between Large and Small Companies Is Growing. Why?

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Baruch Lev, Anup Srivastava, Luminita Enache

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July 17, 2019

The Problem with France's Plan to Tax Digital Companies

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Anup Srivastava, Hussein Warsame, Luminita Enache

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May 30, 2019

R&D Spending Has Dramatically Surpassed Advertising Spending

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Shivaram Rajgopal, Anup Srivastava, Ye Wang

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January 29, 2019

It’s Time to Stop Treating R&D as a Discretionary Expenditure

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Shivaram Rajgopal, Anup Srivastava, Luminita Enache

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December 3, 2018

Should Dual-Class Shares Be Banned?

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Shivaram Rajgopal, Anup Srivastava, Luminita Enache

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October 15, 2018

Should Everyone Be Allowed to Invest in Private Tech Companies?

Source: Harvard Business Review (online)

Authors: Vijay Govindarajan, Shivaram Rajgopal, Anup Srivastava, Luminita Enache

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