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ItemThe relationship between corporate social responsibility, financial misstatements and SEC enforcement actions(Wiley, 2020-04-01)This study explores the relationship between corporate social responsibility (CSR), financial misstatements and SEC enforcement actions. We find that firms with higher CSR are less likely to receive SEC enforcement actions for financial misstatements. Drawing on insights from stakeholder theory and the reputational literature, we identify two channels underpinning this relationship: (i) firms with higher CSR are less likely to engage in financial misstatements and (ii) the reputational effect of CSR reduces the likelihood of SEC enforcement actions. We find empirical evidence consistent with both channels.
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ItemThe Role of Psychic Distance in Entry Mode Decisions: Magnifying the Threat of Opportunism or Increasing the Need for Local Knowledge?(Wiley, 2020-05-01)Research Summary: With respect to entry mode decisions, psychic distance may play two contradictory roles. On one hand, the transaction cost perspective is concerned with opportunism. Psychic distance magnifies the threat of opportunism, which encourages higher levels of control by foreign firms. Conversely, the new internalization perspective emphasizes the role of complementary assets controlled by local entities. Distance increases the need to access local knowledge, which encourages firms to seek joint ventures. By adopting an experimental approach and measuring managers' a priori perceptions of distance, this article contributes to the literature by providing a more sophisticated approach for discriminating between these effects. The results indicate that distance magnifies the need for firms to access complementary assets; however, distance does not appear to magnify the threat of opportunism. Managerial Summary: This article explores the role that psychic distance (i.e., differences across countries in culture, language, religion, etc.) plays in how firms enter foreign markets. Specifically, do they prefer wholly owned subsidiaries (WOS) or do they prefer to form joint ventures (JV) with local players? One perspective argues that firms are concerned about potential partners in a foreign market taking advantage of them; thus, they will prefer the greater control a WOS offers. Conversely, firms may simply recognize that these differences put them at a disadvantage and prefer a JV as a way to gain local knowledge. Our experiments indicate that the latter explanation dominates. When entering very different countries, managers seem to prefer JVs in order to access key local knowledge.
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ItemReply to Drs Almendra‐Arao and Sotres‐Ramos regarding Barnard's concept of convexity and possible extensions(Wiley, 2020-05-01)On p. 130 of his 1947's seminal paper, Barnard1 wrote: “we propose that in our ordering, the two points which, respectively, have the same abscissa or the same ordinate as (a, b), and which lie further from the diagonal PR, shall be considered as indicating wider differences than (a, b) itself. Thus, […] the points immediately above and immediately to the left of the point ‘x’ are reckoned to indicate wider differences than the point ‘x’ itself. This condition implies that the set of points indicating differences as wide or wider than (a, b) will have a shape property vaguely related to convexity, and we call it the ‘C condition’.” It appears clear from this quotation how Barnard himself did not refer to a mathematical definition of a convex set strictu sensu but, instead, was providing the reader with the intuition of convexity linked to his definition. In this spirit, since our paper2 was a review paper for non‐experts, our intent was to point out that there is no obvious connection with the usual notion of a convex set, which is usually a condition that ensures convergence of algorithms to a unique optimum. We were not aware of the extended notions of convexity geometry or polyomino convexity that have appeared in the literature, and we thank the authors for pointing out that Barnard convex sets do satisfy these definitions. We would suggest that in future, when quoting Barnard convexity, it will be noted that it is not related to closure under linear combination. In any case, we prefer to emphasise the monotonicity properties of the generating statistic and how this affects computation of the exact or quasi‐exact P value.
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ItemSystematic review of education and practical guidance on regression modeling for medical researchers who lack a strong statistical background: Study protocol(PUBLIC LIBRARY SCIENCE, 2020-12-21)In the last decades, statistical methodology has developed rapidly, in particular in the field of regression modeling. Multivariable regression models are applied in almost all medical research projects. Therefore, the potential impact of statistical misconceptions within this field can be enormous Indeed, the current theoretical statistical knowledge is not always adequately transferred to the current practice in medical statistics. Some medical journals have identified this problem and published isolated statistical articles and even whole series thereof. In this systematic review, we aim to assess the current level of education on regression modeling that is provided to medical researchers via series of statistical articles published in medical journals. The present manuscript is a protocol for a systematic review that aims to assess which aspects of regression modeling are covered by statistical series published in medical journals that intend to train and guide applied medical researchers with limited statistical knowledge. Statistical paper series cannot easily be summarized and identified by common keywords in an electronic search engine like Scopus. We therefore identified series by a systematic request to statistical experts who are part or related to the STRATOS Initiative (STRengthening Analytical Thinking for Observational Studies). Within each identified article, two raters will independently check the content of the articles with respect to a predefined list of key aspects related to regression modeling. The content analysis of the topic-relevant articles will be performed using a predefined report form to assess the content as objectively as possible. Any disputes will be resolved by a third reviewer. Summary analyses will identify potential methodological gaps and misconceptions that may have an important impact on the quality of analyses in medical research. This review will thus provide a basis for future guidance papers and tutorials in the field of regression modeling which will enable medical researchers 1) to interpret publications in a correct way, 2) to perform basic statistical analyses in a correct way and 3) to identify situations when the help of a statistical expert is required.
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ItemQuantile Co-Movement in Financial Markets: A Panel Quantile Model With Unobserved Heterogeneity(Taylor & Francis, 2020)This article introduces a new procedure for analyzing the quantile co-movement of a large number of financial time series based on a large-scale panel data model with factor structures. The proposed method attempts to capture the unobservable heterogeneity of each of the financial time series based on sensitivity to explanatory variables and to the unobservable factor structure. In our model, the dimension of the common factor structure varies across quantiles, and the explanatory variables is allowed to depend on the factor structure. The proposed method allows for both cross-sectional and serial dependence, and heteroscedasticity, which are common in financial markets. We propose new estimation procedures for both frequentist and Bayesian frameworks. Consistency and asymptotic normality of the proposed estimator are established. We also propose a new model selection criterion for determining the number of common factors together with theoretical support. We apply the method to analyze the returns for over 6000 international stocks from over 60 countries during the subprime crisis, European sovereign debt crisis, and subsequent period. The empirical analysis indicates that the common factor structure varies across quantiles. We find that the common factors for the quantiles and the common factors for the mean are different. Supplementary materials for this article are available online.
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ItemNo Preview AvailableThe effect of CEO incentives on deviations from institutional norms in foreign market expansion decisions: Behavioral agency and cross-border acquisitions(Wiley, 2020-09-01)CEO incentives have been the subject of great interest for human resource scholars. We explore the institutional context within which the CEO makes sense of their incentives. Our theory suggests that CEO equity incentives interact with institutional norms to influence foreign market entry choices. Specifically, we argue that CEOs will weigh the risk bearing created by equity incentives, along with the consequences of legitimacy loss, when deciding whether to deviate from institutional norms when internationalizing. In doing so, we advance human resource literature by demonstrating that CEO responses to incentives are influenced by institutional norms and that CEOs' decisions to deviate from institutional norms are shaped by their incentives. We find support for our framework in the analysis of the stake taken by acquirers in 4,184 cross‐border acquisitions.
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ItemToward a theory of entry in moral markets: The role of social movements and organizational identity(SAGE Publications, 2020-02-01)A growing body of research on moral markets—sectors whose raison d’être is to create social value by offering market solutions to social and environmental issues—has offered critical insights into the emergence and growth of these sectors. Less is known, however, about why some firms enter moral markets while others do not. Drawing from research on market entry, organizational identity, and social movements, we develop a theory that highlights the potential of organizational identity to explain variation in entry into moral markets. We then expand our framework by theorizing about contingencies that alter the shape of the relationship between organizational identity and market entry: the flexibility of the organizations’ identity, the type, and orientation of the social movement supporting the moral market, and the mode of market entry (de novo vs de alio). Finally, we discuss the contributions of our framework and opportunities for its extension.
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ItemCold War spy satellite images reveal long-term declines of a philopatric keystone species in response to cropland expansion: Spy satellites reveal species declines(Royal Society, The, 2020-05-27)Agricultural expansion drives biodiversity loss globally, but impact assessments are biased towards recent time periods. This can lead to a gross underestimation of species declines in response to habitat loss, especially when species declines are gradual and occur over long time periods. Using Cold War spy satellite images (Corona), we show that a grassland keystone species, the bobak marmot (Marmota bobak), continues to respond to agricultural expansion that happened more than 50 years ago. Although burrow densities of the bobak marmot today are highest in croplands, densities declined most strongly in areas that were persistently used as croplands since the 1960s. This response to historical agricultural conversion spans roughly eight marmot generations and suggests the longest recorded response of a mammal species to agricultural expansion. We also found evidence for remarkable philopatry: nearly half of all burrows retained their exact location since the 1960s, and this was most pronounced in grasslands. Our results stress the need for farsighted decisions, because contemporary land management will affect biodiversity decades into the future. Finally, our work pioneers the use of Corona historical Cold War spy satellite imagery for ecology. This vastly underused global remote sensing resource provides a unique opportunity to expand the time horizon of broad-scale ecological studies.
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ItemCategory Inventory Planning With Service Level Requirements and Dynamic Substitutions(Wiley, 2020-11-01)We study a single‐period inventory planning problem for a category of substitutable products. This is an important practical problem facing category managers who have to maintain high service levels for constantly expanding product catalogs. We formulate the problem as a stochastic optimization model that minimizes the total stocking cost subject to service level requirements, which consist of product‐specific and category‐wide targets for inventory availability (ready rates) through the selling season. Our model accounts for stochastic customer arrivals, captures stockout‐based substitutions, and determines initial stocking quantities jointly for all products. Recognizing the challenges that these aspects pose in solving the problem, we propose an optimization‐based method that estimates the ready rates using a deterministic approximation and discretizes the selling season into a finite number of time intervals. This novel modeling approach permits us to recast the stochastic optimization model as a deterministic mixed integer linear program that can accommodate several common stockout‐based substitution schemes. We characterize the worst‐case behavior of this approach to develop performance guarantees. We also implemented and applied this model to randomly generated numerical instances featuring different types of product differentiation and varying in parameter values. We observe that the approach is robust to changes in problem parameter values and yields solutions very quickly, outperforming an enumeration‐based alternative, a practical heuristic, and an approach based on extant literature. Finally, we applied our approach to data from a re‐seller of Information Technology products. Results illustrate that our approach scales well and has the potential to generate savings in inventory costs.
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ItemAbusive according to whom? Manager and subordinate perceptions of abusive supervision and supervisors' performance(Wiley, 2020-10-01)Recognizing that supervisor–subordinate dyads exist within a broader organizational hierarchy, we examine how the individual's role within the organizational hierarchy influences perceptions of abusive supervision. Specifically, we examine how supervisors' abusive behaviors are perceived by abusive supervisors' managers as well as abusive supervisors' subordinates. Drawing on role theory, we propose that these perceptions will differ. Further, we suggest that these differences will be reflected in different relationships between manager-rated abusive supervision and subordinate-rated abusive supervision and managers' evaluations of supervisor performance. Results from manager–supervisor–subordinate triads indicate differences between managers' and subordinates' view of abusive supervision. Further, managers' perceptions of abuse were related to supervisors' in-role performance, whereas subordinates' perceptions of abuse were related to workgroup performance. In Study 2, we replicate these findings and expand our investigation to an examination of supervisors' contextual performance. Additionally, we examine another contextual characteristic—aggressive climate—and demonstrate it influences how abusive supervision relates to managerial evaluations of supervisor performance. Future research and managerial implications are discussed.