As Ken Kelley discussed in his May 10 guest column, summer is a busy time for faculty research. The recent edition of Mendoza Business magazine includes a listing of published research from 2018-2021.
Please find below a few of the most recent faculty publications in top academic journals (and congratulations to the authors!):
Erik Beardsley, Assistant Professor of Accountancy
"What's My Target? Individual Analyst Forecasts and Last-Chance Earnings Management" (Journal of Accounting & Economics)
Our study shows that companies manipulate their accounting earnings in order to meet or beat individual analyst forecasts. Companies are also more likely to beat an additional forecast by manipulating earnings up relative to missing an additional forecast when decreasing accounting earnings. By showing that managers consider individual forecasts to calibrate earnings management decisions, our findings highlight the strategic nature of earnings management.
"What's My Target? Individual Analyst Forecasts and Last-Chance Earnings Management" (Journal of Accounting & Economics)
Our study shows that companies manipulate their accounting earnings in order to meet or beat individual analyst forecasts. Companies are also more likely to beat an additional forecast by manipulating earnings up relative to missing an additional forecast when decreasing accounting earnings. By showing that managers consider individual forecasts to calibrate earnings management decisions, our findings highlight the strategic nature of earnings management.
Jason Colquitt, Franklin D. Schurz Professor
"Continue the Story or Turn the Page? Coworker Reactions to Inheriting a Legacy" (Academy of Management Review)
This theory piece describes the concept of employee legacy — enduring contributions to a work unit that continue to impact the unit after the employee is no longer a member. In particular, the article articulates the critical role played by the coworkers who remain, as they build on, maintain, neglect or erase the legacy. Which of those actions the coworkers take is theorized to depend on their psychological ownership of the legacy and their relationship with the employee who left it.
"Continue the Story or Turn the Page? Coworker Reactions to Inheriting a Legacy" (Academy of Management Review)
This theory piece describes the concept of employee legacy — enduring contributions to a work unit that continue to impact the unit after the employee is no longer a member. In particular, the article articulates the critical role played by the coworkers who remain, as they build on, maintain, neglect or erase the legacy. Which of those actions the coworkers take is theorized to depend on their psychological ownership of the legacy and their relationship with the employee who left it.
Zhi Da, Howard J. and Geraldine F. Korth Professor of Finance
"Hedging Demand and Market Intraday Momentum" (Journal of Financial Economics)
Gamma measures the acceleration of financial derivative price when the underlying price moves. Market makers in products with gamma exposure, such as options and leveraged ETFs, have to buy additional securities when prices rise and sell when prices fall, exacerbating price swing. Using intraday futures returns between 1974 and 2020, we find strong market intraday momentum on equities, bonds, commodities, and currencies, and provide novel evidence that links it to gamma hedging.
"Hedging Demand and Market Intraday Momentum" (Journal of Financial Economics)
Gamma measures the acceleration of financial derivative price when the underlying price moves. Market makers in products with gamma exposure, such as options and leveraged ETFs, have to buy additional securities when prices rise and sell when prices fall, exacerbating price swing. Using intraday futures returns between 1974 and 2020, we find strong market intraday momentum on equities, bonds, commodities, and currencies, and provide novel evidence that links it to gamma hedging.
Kirsten Martin, William P. and Hazel B. White Center Professor of Technology Ethics
"Stakeholder Friction" (Journal of Business Ethics)
Many have focused on identifying the good in creating strong relationships with a company’s stakeholders (suppliers, financiers, customers, communities, users, employees and so on) such as weathering uncertainty, greater sharing of information, increased legitimacy and better performance. However, here we identify a downside of strong stakeholder relationships: increased stakeholder friction where companies are more likely to re-invest in current stakeholders even when this investment is not in their interest. This can lead to company’s missing out on new stakeholders (new customers, new suppliers, new products) by focusing too much on current stakeholder relationships.
"Stakeholder Friction" (Journal of Business Ethics)
Many have focused on identifying the good in creating strong relationships with a company’s stakeholders (suppliers, financiers, customers, communities, users, employees and so on) such as weathering uncertainty, greater sharing of information, increased legitimacy and better performance. However, here we identify a downside of strong stakeholder relationships: increased stakeholder friction where companies are more likely to re-invest in current stakeholders even when this investment is not in their interest. This can lead to company’s missing out on new stakeholders (new customers, new suppliers, new products) by focusing too much on current stakeholder relationships.
Thank you to all of our faculty for your continued efforts to advance the College’s research reputation.
In Notre Dame,
Martijn