Accounting harmonization plays an important role in global capital markets. A single set of financial reporting standards around the world potentially can facilitate cross-border comparisons of financial data and make it easier for analysts to cover foreign firms by lowering information acquisition costs. It can also improve forecast accuracy by helping ... Read More

A consumer feels unwell and decides to buy some medicine to treat the illness. The local drug store offers a choice of Western or alternative remedies (such as TCM – traditional Chinese medicine), but the consumer’s choice may depend less on the stated effects of the medicine than his or her beliefs about the illness and goals in treating it. TCM and other ... Read More

Anchoring bias happens when people overemphasize a starting point when they make predictions or decisions. In the case of analysts, Ling Cen, Gilles Hilary and K.C. John Wei show that their forecast earnings per share (FEPS) are influenced by the industry median, which in turn leads them to underestimate future profitability for firms with abnormally high ... Read More

The movie industry is characterized by a high seasonality in viewer demand. In the US, the majority of revenues are concentrated around major public holidays in summer and winter, and so movie studios tend to time major releases for these periods. New research, however, suggests an additional factor could be useful in timing releases – the temperature ... Read More

Rounding off numbers to zero or five for earnings forecasts can help to simplify and communicate their value, but it is not the most accurate form of measurement. Previous research has suggested that analysts who round off are less informed than other analysts. Patricia M Dechow and Haifeng You suggest that is only part of the story. They extended the ... Read More

Imagine that you have been eagerly awaiting the release of a major Hollywood blockbuster film, and you are now in a long queue of excited fans, mostly teenagers, at the first show on the first night. As you are waiting, a crew from a local TV company arrives at the scene and identifies you as an important business school professor. Their camera starts ... Read More

Employee “voice” is important to organizations. When employee express voice by offering constructive ideas on how to make improvements, or pointing out harmful or wasteful practices, voice can enhance a firm’s ability to innovate and adapt to dynamic changes in the working environment. It is therefore important to understand what motivates and enables ... Read More

When earnings fall short of targets or don’t achieve a desired strategic goal, managers often engage in earnings management. These manipulations can either take place during the fiscal year – one survey found 80 per cent of Chief Financial Officers had decreased R&D, advertising and maintenance expenditures to deliver earnings – or they can occur after the ... Read More

Popular opinion holds that credit enforcement which strengthens lenders’ rights to appropriate collateral in the event of default, can reduce access to credit for poorer borrowers. Economists argue otherwise, saying it enlarges the credit available by increasing lender confidence. But evidence from one study suggests the popular view may be right. Ulf von ... Read More

Marketers often attempt to connect their brand with an aspect of consumer social identity such as gender, nationality, university, or ethnicity. For example, a campaign for the aftershave Old Spice attempted to connect its brand with male gender identity through the use of the tagline “Smell like a man, man,” whereas the deodorant Secret linked to female ... Read More