Decision Making & Negotiations

Can event marketing contribute to brand equity? A field study with consumers participating in different types of events indicates that event attendance increases brand equity and that brand experience is the most important mediator. Brand attitudes mediate the relation between events and brand equity only for certain types of events (namely, trade and street events, but not pop-up shops and sponsored events). Implications of the results for event marketing theory and practice are discussed.

We provide insights into earnings quality from a survey of 169 CFOs of public companies and in-depth interviews of 12 CFOs and two standard setters.

At a time of historic challenges to the viability of the Eurozone, we assess the contribution of the EU and the Euro to equity market integration in Europe. We use a simple and essentially model free measure of bilateral market segmentation: two countries are segmented if there is a wide divergence in the valuations of their industries. We first establish that segmentation is significantly lower for EU versus non-EU members.

Past work has argued that comparison mindsets affect stereotyping: perceivers in a difference mindset stereotype less than those in a similarity mindset, contrasting their judgments of an individual away from their representation of the group. Here, we argue that the self can also act as a reference point, implying that the impact of comparison mindsets depends on what is focal.

We develop a dynamic valuation model of private equity (PE) investments by solving the portfolio-choice problem for a risk-averse investor (LP), who invests in a PE fund, managed by a general partner (GP). Key features are illiquidity, leverage, GP value-adding skills (alpha), and compensation, including management fees and carried interest. We find that the costs of management fees, carried interest, and illiquidity are high, and the GP needs to generate substantial value to cover these costs. Leverage substantially reduces these costs.

Global economic transactions such as foreign direct investment (FDI) must extend over an institutional abyss between the jurisdiction, and therefore protection, of the states involved. Intergovernmental organizations (IGOs) represent an important attempt to span this abyss. The authors use a network approach to demonstrate that the connections between two countries, through joint membership in the same IGOs, are associated with a large positive influence on the FDI that flows between them.

Using data from a major mortgage bank, we examine the predictive power of mortgage delinquency models as an aggregate measure of the quality of information recorded at loan origination. We measure model predictive power using an out-of-sample prediction criterion and compare predictive power of delinquency models over time and across loans of different documentation levels and origination channels.

Research has shown that subtle health claims used by food marketers influence pre-intake expectations, but no study has examined how they influence individuals' post-consumption experience of satiety after a complete meal and how this varies according to the value placed on food taste. In two experiments, we assess how labeling a pasta salad as "healthy" or "hearty" influences self-reported satiety, consumption volume, and subsequent consumption of another food.

The 2008 financial crisis exemplifies significant uncertainties in corporate financing conditions. We develop a unified dynamic q- theoretic framework where firms have both a precautionary-savings motive and a market-timing motive for external financing and payout decisions, induced by stochastic financing conditions. The model predicts (1) cuts in investment and payouts in bad times and equity issues in good times even without immediate financing needs; (2) a positive correlation between equity issuance and stock repurchase waves.