The Effect of SFAS No. 131 on the Cross-segment Variability of Profits Reported by Multiple Segment Firms

Our study assesses whether SFAS No. 131 improved disclosure about the diversity of multiple segment firms’ operations. We find a post-SFAS No. 131 increase in cross-segment variability of segment profits, an increase in the association between reported and inherent cross-segment variability, and an increase in association between reported variability and capital market incentives to disclose. We interpret the results as evidence that SFAS No. 131 increased the transparency of segment profitability disclosures, and as indicating SFAS No. 131 allowed firms depending more on external financing to disclose more about differences in segment profitability.

JUST A BIG MISUNDERSTANDING? BIAS AND BAYESIAN AFFECTIVE POLARIZATION

I present a model of affective polarization—growth in hostility over time between two parties—via quasi-Bayesian inference. In the model, two agents repeatedly choose actions. Each choice is based on a balance of concerns for private interests and the social good. More weight is put on private interests when an agent's character is intrinsically more self-serving and when the other agent is believed to be more self-serving. Each agent Bayesian updates about the other's character, and dislikes the other more when she is perceived as more self-serving. I characterize the effects on growth in dislike of three biases: a prior bias against the other agent's character, the false consensus bias, and limited strategic thinking. Prior bias against the other's character remains constant or declines over time, and actions do not diverge. The other two biases cause actions to become more extreme over time and repeatedly be “worse” than expected, causing mutual growth in dislike, that is, affective polarization. The magnitude of dislike can become arbitrarily large—even when both players are arbitrarily “good” (unselfish). The results imply that seemingly irrelevant cognitive biases can be an important cause of the devolution of relationships, in politics and beyond, and that subtlety and unawareness of bias can be key factors driving the degree of polarization.     

A few bad apples: Communication in the presence of strategic ideologues

I propose a very simple model of strategic communication. The motivation is to help explain widespread persistent disagreement about objective facts. In the model, there is a message sender and a receiver, and two possible states of the world, left or right. The sender is one of three types: honest, or a leftist or rightist “ideologue.” The honest type observes a private signal in , with higher values implying stronger support for the right state, and reports the observed value truthfully. Ideologues strategically choose any message from this set to maximize the receiver's belief in their preferred state, ignoring any private information they may have. I show that a small presence of ideologues can have a large effect on communication: while we might expect ideologues to just send extreme messages, in most equilibria ideologues use “strategic understatement,” and in many cases actually mix over all non‐neutral (non‐N∕2) messages to mimic honest types and gain credibility. This distorts the interpretation of these messages such that all messages on a side of the spectrum (above or below N∕2) have the same effect on receiver beliefs. This coarsened communication is less informative than even the weakest non‐neutral messages in the absence of ideologues. I show by example how ideologues can cause large delays in the time required for receiver beliefs to converge to truth.     

Are consumers' financial needs and values common across cultures? Evidence from six countries

Are consumers' financial needs, and financial values, the same or different across cultures? Two studies, with student (Study 1; n = 988) and non‐student (Study 2; n = 959) participants, explore the extent of equivalence, across six countries (Brazil, Russia, China, Taiwan, Tunisia and US), in financial need belief, and financial value, measurement models. The financial need beliefs, derived from self‐determination theory (SDT) principles, include financial self‐efficacy, financial autonomy, financial community trust and support; the financial values include materialism and financial altruism. Both the financial need and financial value constructs evidence configural invariance (similar factor structure), and factor invariance among student but not non‐student samples. The financial need constructs evidence full, and the financial value constructs evidence partial, metric (factor loading) invariance. Factor covariance invariance obtains for the financial need beliefs constructs but not the financial value constructs. Finally, neither financial need nor financial value constructs evidence scalar (intercept) invariance. These results provide partial support for extending SDT's hypothesis of universal human needs to the financial domain. In contrast, the financial value constructs of altruism and materialism are largely instable across cultures, suggesting that consumer views of giving, and the role of wealth in social status, differ between countries.     

Distribution of Marketing Research Material to Universities: The Case of Archive of Market and Social Research (AMSR)

ABSTRACT

The aim of this note is to understand how content relating to marketing and market research is distributed to and within universities. The focus of the study includes the behavior of all those in this market for information, namely suppliers (whether content generators, aggregators, packagers, or distributors of content) of marketing research, university staff, and students. The case study method was implemented to collect data. The case study focuses on UK Higher Education. Specifically, the authors use the case study of the newly developed Archive of Market and Social Research (AMSR) to explore how content relating to marketing and market research is distributed to and within universities. The research involved personal interviews with 15 librarian senior managers selected from 14 universities.

The interviews with librarians provided insight into how AMSR could be distributed to university libraries and how it could be accessed. The findings highlight the role of university academics in specifying the content of marketing and market research. They focus on ‘real world’ management problems to deliver research with impact and relevant teaching. Therefore, they need company and industry information and are more likely to use current sources. The study maps the process of acquisition of marketing and market research content by universities and identifies the different roles involved in this process. The study is in line with the emerging literature that focuses on the role of education in explaining the relevance gap in marketing research. The study contrasts between the situation in the university market and industrial buying and adds to our understanding of the complexities associated with the distribution of the marketing research material. The result is expected to be a much sharper focus for the marketing of the archive material, leading to greater use of recent high-quality market research by marketing educators, and changes to marketing and market research syllabuses.

This note provides insight into how suppliers (whether content generators, aggregators, packagers, or distributors of content) of market and marketing research should market to universities and ensure the use of their information resources by students and teachers and how they should. The findings of the study contribute to understanding customer needs and shaping a new service product proposition. In addition, the study provides insight into how university students and staff access and should access commercial research on marketing from the market research industry (in particular from the Archive of Market and Social Research) and use it in their learning, so that their knowledge will be more up to date and their employability will be increased. Adding several insights to the issue of distribution of marketing research material to universities. The paper relates to the marketing of information resources to universities, specifically to the work of the Archive of Market and Social Research, in marketing their information assets to universities, and more specifically the relationship between the “push” of suppliers, libraries, journal and textbook suppliers and information aggregators (such as EBSCO and JISC) and the pull coming from academic researchers and lecturers, who might use this information in their teaching and research. The present study can be seen as a classic case study of understanding buyer behavior, but in a modern world of information platforms, aggregation, and the digital economy.     

Corporate decision making in the presence of political uncertainty: The case of corporate cash holdings

Using a quarterly panel of U.S. corporations over the period 1985–2014, we show that corporate managers respond to political uncertainty and economic policy uncertainty shocks in different ways. We proxy for political uncertainty using the Partisan Conflict Index and employ a prevalent empirical macroeconomic methodology to construct structural shocks that are orthogonal to shocks captured by the Economic Policy Uncertainty Index. Following a political uncertainty shock, corporations increase cash but do not adjust investment. Alternatively, following an economic policy uncertainty shock, firms appear to draw on cash and reduce capital spending to increase research and development spending.