Television-Induced Tourism: Evidence from Croatia

Atlantic Economic Journal - This paper analyzes the extent to which the filming of the popular television show Game of Thrones affected tourism in the Croatian city of Dubrovnik. Using monthly data...     

Second time lucky? Withdrawn IPOs that return to the market

We investigate issuers withdrawing an IPO (after security regulation filings) that return later for a successful offering. Venture capital backing and reputation of the lead underwriter are key factors in predicting successful return. The possibility of returning has a significant impact on the decision to withdraw and the pricing of offerings that succeed. Our sample of returning IPOs also provides a unique setting to investigate underwriter switching after a withdrawal but before a successful IPO. We find that switching occurs in response to poor bank performance and when switching firms “graduate” to banks that have high industry market shares.     

The determinants of market-wide issue cycles for initial public offerings

This paper identifies the determinants of market-wide issue cycles for initial public offerings (IPOs) using an autoregressive conditional count model. We consider whether IPO volume is related to business conditions, investor sentiment, and time variation in adverse selection costs caused by asymmetric information between managers and investors. We provide evidence indicating that time variation in business conditions and investor sentiment are important determinants of monthly issue activity. By contrast, time variation in adverse selection costs does not significantly affect IPO volume.     

How do nonprofits respond to negative wealth shocks? The impact of the 2008 stock market collapse on hospitals

The theory of cost shifting posits that nonprofit firms “share the pain” of negative financial shocks with their stakeholders, for example, by raising prices. We examine how nonprofit hospitals responded to the sharp reductions in their assets caused by the 2008 stock market collapse. The average hospital did not raise prices, but hospitals with substantial market power did cost shift in this way. We find no evidence that hospitals reduced treatment costs. Hospitals eliminated but left unchanged their offerings of profitable services. Taken together, our results provide mixed evidence on whether nonprofits behave differently from for‐profits.     

Multigenerational Families and Food Insecurity

The prevalence of multigenerational families is on the rise in the United States, as is food insecurity. We estimate the association of resident grandchildren on transitions in food insecurity using longitudinally linked two‐year panels of the Current Population Survey from 2001 to 2010. We find that rates of food insecurity in families with a grandchild present are at least twice as high in a typical year compared with families without a resident grandchild, and the extent of very low food security increased substantially faster among these households over the past decade. The rise in food insecurity during and after the Great Recession is due to both increased entry into food insecurity and decreased exit out of food insecurity. A similar trend accounts for the rise in multigenerational households during the recession—grandchildren were more likely to move in with their grandparents, and once there, were less likely to move out. Our transition models show that whether grandchildren remain, or in periods of transition, multigenerational families are at heightened risk of entering food insecurity and remaining in this state. However, the entry of a grandchild may not always be a negative for the family's food security, nor the exit of the child a positive. Entrance of a child seems to buffer the family from extreme forms of food insecurity while exit exposes the family to risk of deeper food insecurity.     

Shareholder Primacy,Corporate Social Responsibility,and the Role of Business Schools

This paper examines the shareholder primacy norm (SPN) as a widely acknowledged impediment to corporate social responsibility and explores the role of business schools in promoting the SPN but also potentially as an avenue for change by addressing misconceptions about shareholder primacy and the purpose of business. We start by explaining the SPN and then review its status under US and UK laws and show that it is not a likely legal requirement, at least under the guise of shareholder value maximization. This is in contrast to the common assertion that managers are legally constrained from addressing CSR issues if doing so is inconsistent with the economic interests of shareholders. Nonetheless, while the SPN might be muted as a legal norm, we show that it is certainly evident as a social norm among managers and in business schools—reflective, in part, of the sole voting rights of shareholders on corporate boards and of the dominance of shareholder theory—and justifiably so in the view of many managers and business academics. We argue that this view is misguided, not least when associated with claims of a purported legally enforceable requirement to maximize shareholder value. We propose two ways by which the influence of the SPN among managers might be attenuated: extending fiduciary duties of executives to non-shareholder stakeholders and changes in business school teaching such that it covers a plurality of conceptions of the purpose of the corporation.     

Free-Agency and the Competitiveness of Major League Baseball

I investigate whether the removal of the reserve clause in professional baseball affected the competitive nature of the industry in the context of whether the distribution of team wins has been affected by free-agency. Unlike previous studies which use the standard deviation of winning percentage, I use a more sensitive measure of parity. I calculate the deviations of the Herfindahl-Hirschman Index of team wins from the competitive ideal during 1920 to 1996 and relate them to player-talent distribution and structural changes in the industry. I isolate the structural effect of free-agency and find that it has adversely affected the parity of the American League but that it has had no statistical influence on the parity of the National League.     

Experiments in supply chain management research: A systematic review and future directions

The supply chain management discipline has seen a tremendous growth in the use of experimental methods. Given the large number of published studies, the time seems opportune to systematically review the use of such approaches. In this note, we consider multiple dimensions of experimental design used in articles published in six of our premier journals. We present these findings and contemplate opportunities for future applications of experimental methods. In particular, we highlight a need to more regularly conduct and report on the results of power analyses and experimental checks, more carefully contemplate the justification and use of WEIRD (Western, educated, industrial, rich, and democratic) participants, develop and test mediated theoretical models, and increase our focus on teams as the unit of analysis when using experimental methods.     

New low-frequency spread measures

I develop new spread proxies that pick up on three attributes of the low-frequency (daily) data: (1) price clustering, (2) serial price covariance accounting for midpoint prices on no-trade days, and (3) the quoted spread that is available on no-trade days. I develop and empirically test two different approaches: an integrated model and combined models. I test both new and existing low-frequency spread measures relative to two high-frequency benchmarks (percent effective spread and percent quoted spread) on three performance dimensions: (1) higher individual firm correlation with the benchmarks, (2) higher portfolio correlation with the benchmarks, and (3) lower distance relative to the benchmarks. I find that on all three performance dimensions the new integrated model and the new combined model do significantly better than existing low-frequency spread proxies.