Frothy Housing Markets and Local Stock-Price Movements

Prior empirical research finds habitat effects manifest in stock pricing among firms that share headquarters cities. We empirically investigate whether trends in residential real estate prices affect headquarters-city stock pricing phenomena for companies across U.S. metro areas for 1989?C2004. Specifically, we hypothesize that stocks of firms headquartered in ??hot?? residential real estate markets experience higher returns compared to stocks of firms from ??cold?? markets. We also hypothesize that stocks of firms headquartered in hot real estate markets display stronger return comovement with same-city stocks. We find support for these hypotheses during the 1999?C2004 sample period which coincides with the start of the housing bubble of the 2000?s; we find mixed results in earlier periods. Our findings indicate that city-specific home price patterns conditionally affect stock pricing of local firms, suggesting that investor behavior is influenced by localized shocks to household real estate wealth.     

How Does the FOMC Learn About Economic Revolutions? Evidence from the New Economy Era, 1994–2001

Forecasting is a daunting challenge for business economists and policymakers, often made more difficult by pervasive uncertainty. One such uncertainty is the reaction of policymakers to major shifts in the economy. We explore the process by which the Federal Reserve Open Market Committee (FOMC) came to recognize and react to the productivity acceleration of the 1990s. Initial impressions were formed importantly by anecdotal evidence. Then, FOMC members—and chiefly Federal Reserve Board Chairman Alan Greenspan—came to mistrust the data and the forecasts. Eventually, revisions to published data confirmed initial impressions. Our main conclusion is that the productivity-driven positive supply side shocks of the 1990s were initially viewed favorably. However, over time they came to be viewed as posing a threat to the economy, chiefly through unsustainable increases in aggregate demand growth that threatened to increase inflation pressures. Perhaps nothing so complicates business planning and forecasting as policymakers who initially embrace an unanticipated shift and later come to abhor the same shift.     

Research and development target‐setting difficulties addressed through the emergent method: technology forecasting using data envelopment analysis

The aim of this study is to provide a foundation for researchers and managers to discuss and resolve difficulties associated with research and development (R&D) target‐setting. While multiple studies mention the difficulty of R&D target‐setting, few have compiled reasons for these difficulties or addressed this issue in detail. This paper provides one of the first studies outlining reasons for R&D target‐setting difficulties through a literature review. It also provides an initial set of analyses and results after applying an emerging quantitative method, Technology Forecasting Using Data Envelopment Analysis (TFDEA), to illustrate these difficulties step‐by‐step to commercial airplanes. Results include determining the state of art in commercial airplane technology and technological rate‐of‐change variants in setting R&D targets.     

Customer value propositions in business markets

Examples of consumer value propositions that resonate with customers are exceptionally difficult to find. When properly constructed, value propositions force suppliers to focus on what their offerings are really worth. Once companies become disciplined about understanding their customers, they can make smarter choices about where to allocate scarce resources. The authors illuminate the pitfalls of current approaches, then present a systematic method for developing value propositions that are meaningful to target customers and that focus suppliers' efforts on creating superior value. When managers construct a customer value proposition, they often simply list all the benefits their offering might deliver. But the relative simplicity of this all-benefits approach may have a major drawback: benefit assertion. In other words, managers may claim advantages for features their customers don't care about in the least. Other suppliers try to answer the question, Why should our firm purchase your offering instead of your competitor's? But without a detailed understanding of the customer's requirements and preferences, suppliers can end up stressing points of difference that deliver relatively little value to the target customer. The pitfall with this approach is value presumption: assuming that any favorable points of difference must be valuable for the customer. Drawing on the best practices of a handful of suppliers in business markets, the authors advocate a resonating focus approach. Suppliers can provide simple, yet powerfully captivating, consumer value propositions by making their offerings superior on the few elements that matter most to target customers, demonstrating and documenting the value of this superior performance, and communicating it in a way that conveys a sophisticated understanding of the customer's business priorities.     

Founding-Family Ownership and Firm Performance: Evidence from the S&P 500

We investigate the relation between founding‐family ownership and firm performance. We find that family ownership is both prevalent and substantial; families are present in one‐third of the S&P 500 and account for 18 percent of outstanding equity. Contrary to our conjecture, we find family firms perform better than nonfamily firms. Additional analysis reveals that the relation between family holdings and firm performance is nonlinear and that when family members serve as CEO, performance is better than with outside CEOs. Overall, our results are inconsistent with the hypothesis that minority shareholders are adversely affected by family ownership, suggesting that family ownership is an effective organizational structure.     

Leadership quality and follower affect: A study of U.S. presidential candidates

Using the tripartite model of attitude structure as a conceptual basis, this article investigates voter attitudes toward presidential candidates, including cognitive and affective assessments of these leaders as well as behavioral intentions and voting behavior. Data collected from the seven most recent U.S. presidential elections were used to compare Democratic and Republican Party candidates who were successful in securing votes to those who were unsuccessful. Here, follower perceptions of leader intelligence, feelings of pride and hope, as well as feelings of fear and anger were found to be statistically different between the two groups. Additionally, regression analysis using follower assessments of candidates' leadership quality, as dependent upon certain perceptual traits of that leader, are presented. Candidates perceived to be higher in intelligence, considered to possess stronger degrees of inspirational quality, and judged more “likeable,” in terms of generating stronger degrees of positive follower affect and lower degrees of negative follower affect, are considered better quality leaders. Followers' perceptions of these traits are found to be key predictors of whether that follower will consider a leader to be of high quality.     

Understanding hospital quality: the case of cumulative and balanced quality

A more precise way to conceptualize and operationalize hospital quality is needed to increase hospitals’ productivity. This paper investigates how hospitals’ conformance quality (CQ) and experiential quality (EQ), in terms of their combined magnitude (i.e. their interaction) and relative balance (i.e. the absolute difference between them) impact hospital productivity. First, we explore the impact of both the ‘combined dimension of quality’ and ‘balance dimension of quality’ on hospital productivity. Second, we investigate quality dominance to analyze its impact on productivity when CQ is greater than EQ, and vice versa. Secondary data (January 2015 to December 2015) were collected from the Centers for Medicare and Medicaid Services and American Hospital Directory (AHD) for US acute care hospitals. The results provide strong empirical support for the benefit of minimizing the gap between the two types of quality. In addition, the results suggest that considering quality dominance (experiential vs. conformance) might be useful in shedding light on the inherent tension that exists when firms are forced to allocate resources to provide different types of quality simultaneously.     

What retailers need to understand about website inaccessibility and disabled consumers: Challenges and opportunities

This research uniquely contributes to the marketing policy literature by illuminating the widespread yet seldom studied problem of online inaccessibility of retail websites affecting approximately 30 million disabled Americans. When a website is not designed to be navigated easily or is not compatible with assistive technology such as a screen-reader, these potential customers are not able to independently search for information and conduct transactions. Blind and low vision participants in an empirical study provide their opinions regarding accessibility policy issues and reveal that their frustrations with inaccessible retail websites may result, not only in avoidance of the retailer in its different sales channels but also in antifirm behaviors driven by negative attitudes toward perceived retailer accessibility/disability policy that spur feelings of online marketplace discrimination. Using two different evaluation tools, the top 100 retailers in the United States were evaluated on the accessibility of their websites over the past 4 years (2015–2018). Results show that most websites contain many design errors making navigation very difficult or even impossible for vision impaired consumers. The argument is made that online retailers who proactively address these inaccessibility issues on their websites may significantly increase their customer base and profitability.     

Has Adoption of IFRS Increased Non–North American Institutional Investment in the Canadian Stock Markets?

We investigate whether non–North American (non‐NA) institutional investment in firms listed on the Canadian stock markets increased between the pre‐ and post‐IFRS adoption periods relative to such investment in firms listed on the U.S. stock markets. Prior to IFRS adoption, Canada had high‐quality financial reporting standards that were similar to the U.S. standards. As consequences of IFRS adoption, Canadian financial statements became more comparable with European and other IFRS country financial statements and less comparable with neighboring U.S. financial statements. Thus, a question of interest is whether the enhanced comparability with non‐NA companies was beneficial in terms of attracting non‐NA investment to Canadian companies versus U.S. companies. We find that there was no significant change in non‐NA institutional investment in Canadian firms relative to U.S. firms for the very largest (fifth quintile) and for smaller (first, second, and third quintiles) Canadian companies. However, intermediate‐sized Canadian companies in the fourth size quintile lost non‐NA institutional investment relative to their U.S. peer companies, suggesting that non‐NA investors cared more about comparability with U.S. peer companies than non‐NA peer companies for companies in this size quintile.