Expatriates are a costly investment for multinational corporations (MNCs). They are meant to bring valuable skills and knowledge to subsidiaries to improve performance, but studies have shown mixed results. So much seems to ride on the “expat” and their technical or functional capabilities, but what about their ability to transfer their knowledge to others ... Read More

Individual stocks options in aggregate may appear to be similar to index options in that they are driven by the same fundamentals and their prices are affected by risk in similar ways. But they are dissimilar in one important way: they are generally traded by two different groups of people, each of whom have different motivations that affect how they trade ... Read More

The terms under which firms borrow can be revealing about what they think of their future prospects, according to investigations by Vidhan Goyal and Wei Wang, who looked at instances when firms chose short- or long-term debt maturity and the likelihood that this was guided by their privately-held information. “Firms with favorable private information ... Read More

Callaway Golf is a leading producer of golf equipment; American Software is a small company specializing in software for supply chain management. Two different companies and two different industries. Yet, as it turns out, Callaway Golf’s returns have an impact on American Software. How can that be? A study by Ling Cen, Kalok Chan, Sudipto Dasgupta and Ning ... Read More

Understanding and estimating consumer demand in durable goods has been a challenge to many marketing scholars and economists since they do not have access to good data to study them. In studying consumer preference and brand competition, researchers typically have used aggregate level sales data for durable goods which are often less than ideal to study such ... Read More

A consumer receives an offer for a new version of a mobile phone that will be released in two months: buy now and enjoy a 15 per cent discount. The offer will last only for a week, but the consumer is of two minds. She hasn’t seen the phone nor read any reviews of it. What if she doesn’t like it? Or, what if the phone is a big hit and the offer turns out to ... Read More

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