Earnings management and IPO anomalies in China

This paper empirically examines the impact of earnings management and investor sentiment on IPO anomalies using a sample of 506 Chinese IPOs issued over the 1998–2003 period. We develop a parsimonious pricing model in which both the offer price and the short-term aftermarket price are influenced by the use of earnings management, and show that the offer price can be below the fair price while the short-term equilibrium price in the aftermarket can be overvalued due to investor sentiment. Consistent with the overreaction hypothesis, the empirical results reveal a positive relation between the initial return and managed accruals and a negative relation between the long-term stock performance and the initial return. Earnings management appears to generate a pattern where the initial price following an IPO tends to be inflated by overreaction in the secondary market but adjusts to its fundamental level in the long run. These findings are robust across a variety of test specifications.     

Does Female Directorship on Independent Audit Committees Constrain Earnings Management?

This study examines whether the gender of the directors on fully independent audit committees affects the ability of the committees in constraining earnings management and thus their effectiveness in overseeing the financial reporting process. Using a sample of 525 firm-year observations over the period 2003 to 2005, we are unable to identify an association between the proportion of female directors on audit committees and the extent of earnings management.     

The Effect of Analyst Coverage on the Informativeness of Income Smoothing

This study examines whether analyst coverage affects the informativeness of income smoothing. I find that income smoothing enhances earnings informativeness more greatly for firms with high analyst coverage than for firms with low analyst coverage. The results suggest that income smoothing more efficiently communicates private information to investors when firms are followed by more analysts, consistent with the notion that analysts play an important information intermediary role in enhancing the informativeness of income smoothing.     

Attitude to Risk in Technology-Based Strategic Alliances for Tourism

This article examines how attitude to risk in the tourism industry impacts on the role of strategic alliances in developing technology-based knowledge. A survey of Australian travel sector businesses indicates that strategic alliances in tourism contribute only marginally to technology-based knowledge. The study further found that executives in the travel sector of tourism are risk-averse and this has implications for their perceptions regarding the contribution of alliances to technology-based knowledge. The findings imply that Australian industry policy towards tourism needs to encourage strategic alliances that have the potential to stimulate knowledge-based innovation.     

Building Partnerships to Create Social and Economic Value at the Base of the Global Development Pyramid

This paper builds on London and Hart’s critique that Prahalad’s best-selling book prompted a unilateral effort to find a fortune at the bottom of the pyramid (BoP). Prahalad’s instrumental, firm-centered construction suggests, perhaps unintentionally, a buccaneering style of business enterprise devoted to capturing markets rather than enabling new socially entrepreneurial ventures for those otherwise trapped in conditions of extreme poverty. London and Hart reframe Prahalad’s insight into direct global business enterprise toward “creating a fortune with the base of the pyramid” (p. xi) rather than at the BoP. This shift in language requires a recalibration of strategic focus, we argue, and will necessitate implementation of “moral imagination” to formulate new mental models that can frame the possibility of local entrepreneurs working collaboratively and discursively with development partners drawn from civil society, corporate, and government sectors. Successful partnerships will arise from interactive processes of emergent, co-creative learning within a shared problem domain or “community of practice”. We call attention to three related pluralist framings of situated learning within such communities of practice: (1) decentered stakeholder networks; (2) global action networks; and (3) a focus on “faces and places” as a cognitive lens to humanize and locally situate diverse inhabitants within base of the pyramid partnership projects.     

Revisiting the IMC construct

This paper re-examines a definition of integrated marketing communications (IMC) previously published in this journal, and proposes a revision to that original definition. It reviews topics of research studies conducted on IMC since its inception to the present, and establishes that the theoretical foundations and definitional issues of IMC continue to be an important area of research for most academics. This paper introduces the four pillars of IMC as an offshoot of the proposed revised definition, and discusses each pillar in detail. The paper concludes by illustrating the interplay between the pillars and levels of IMC.     

Rethinking Internal Consistency in Cronbach's Alpha

Stress is one byproduct of hectic and busy lives. Therefore, examining active living and leisure in relation to stress and coping offers an important area of study. This paper presents key findings from a multi-year qualitative study of stress and coping. A series of focus groups were conducted with diverse residents of a western Canadian city including: (a) Aboriginal individuals with diabetes, (b) individuals with disabilities, and (c) people who identified as gay or lesbian. The findings emphasized that active leisure is more than physical activity, and that less physical forms of leisure should not be undervalued in the conceptualization of active living and leisure. Coping with stress using active leisure encompassed a wide range of meanings (e.g., spiritual, social, cultural, altruistic, empowerment).     

An Extension and Further Validation of the Potential for Conflict Index

The Potential for Conflict Index (PCI) was developed to facilitate understanding and applicability of leisure, recreation, and human dimensions findings to managerial concerns. The PCI ranges from 0 (minimal potential for conflict) to 1 (maximum potential for conflict) and simultaneously describes a variable's central tendency, dispersion, and shape using a graphic display. This article (a) describes applications of the original formulation of the PCI (PCI₁) to illustrate the statistic's practical utility, (b) introduces the second generation of the PCI (PCI₂) and discusses enhancements incorporated in this version, (c) describes efforts to validate the PCI₂, and (d) offers suggestions for continuing the empirical validation process. Programs for calculating, graphing, and comparing PCI₂ values are freely available from http://welcome.warnercnr.colostate.edu/~jerryv.