Latest Research Publications

Manufacturers and retailers often advance sell seasonal products or services (e.g., holiday decorations, summer or winter entertainment). The authors examine advance selling in marketing channels to offer several insights. First, it is well established that a decentralized channel suffers from the issue of double marginalization; that is, the manufacturer and retailer both add positive margins when setting their prices, which results in inefficiently high retail prices. The authors find that, under a dynamic wholesale-price contract, advance selling can alleviate this double-marginalization problem and benefit the manufacturer, the retailer, and consumers. Second, the benefit of advance selling diminishes with the product's holding cost, the retailer's stockpiling ability, and the manufacturer's commitment to spot wholesale price. Third, with wholesale-price commitment, advance selling benefits the manufacturer and consumers but hurts the retailer; the manufacturer is better off making a price commitment only when its product's holding cost is sufficiently low and worse off otherwise. Last, the retailer's stockpiling ability decreases its own profit under a dynamic contract but increases it under a commitment contract.

Although social media has helped online newspapers by allowing users to organically share articles, some have argued that it has cannibalized and hurt newspapers through reduced readership and diminished agenda-setting power. Motivated by these two opposing effects, it is critical to understand what affects the duality between sharing news articles on social media and reading the articles on news websites. Using rich clickstream data on online news readership obtained from an English-language newspaper in an Asian country and social media data collected from Twitter, we focus on article sentiment as a key news content attribute and find a differential effect of sentiment on readership and sharing behaviors across the news site and third-party social media platform. Our results show that people are likely to read news articles with negative sentiment on the news site, but they tend to share articles with positive sentiment on Twitter. Specifically, a one-unit increase in content sentiment is associated with a 10.86% or 273-unit decrease in news site page views but a 17.0% or 2.10-unit increase in Twitter sharing volume. Upon decomposition of news article sentiment, we also find a contrasting positive author sentiment effect and a negative news topic valence effect on news readership. To uncover the underlying mechanism of the findings, we test the key intuitions from prior self-presentation literature. We find that an increase in a Twitter user’s followers (i.e., audience size) leads to an increase in the Twitter user’s propensity to share positive-sentiment news articles. Our findings on the role of sentiment on content consumption and sharing affirm the coopetitive but complementary relationship between news websites and social media platforms. Our results also guide publishers to better craft their news content and manage social media presence to improve audience engagement and readership outcomes while preserving the agenda-setting ability of news media.

Can massive online retailers such as Amazon and Alibaba issue digital tokens that potentially compete with bank debit accounts? There is a long history of trading stamps and loyalty points, but new technologies are poised to sharply raise the significance of redeemable assets as a store of value. Here, we develop a simple stylized model of redeemable tokens that can be used to study sales and pricing strategies for issuing tokens, including ICOs. Our central finding is that platforms can potentially earn higher revenues by making tokens non-tradable unless they can generate a sufficiently high outside-platform convenience yield.

New ventures are often short of resources crucial to their survival and development. This research sheds new light on how new ventures can obtain better access to external resources by analysing a survey of a large sample of Chinese private entrepreneurs. We found that by comparison with their non-Buddhist counterparts, Chinese Buddhist entrepreneurs tend to give greater attention to external activities and have a higher chance of gaining sociopolitical legitimacy and therefore have a better chance of accessing external resources such as bank loans. Moreover, the indirect effect on bank loans of the amount of attention allocated to external activities by Chinese Buddhist entrepreneurs is weakened by lower government intervention and better development of intermediary agencies in regions where new ventures are located, largely due to Chinese Buddhist entrepreneurs' reduced reliance on sociopolitical legitimacy to access external resources.

This study is a meta-analysis of how pull marketing actions influence the effectiveness of marketing actions employed by multichannel firms. Pull marketing actions are highly adaptable marketing actions designed to make multichannel distribution channel portfolios attractive. Integrating prior multichannel distribution literature, the authors investigate whether marketing actions’ effectiveness depends on pull marketing actions and their configuration with the distribution channel structure and attributes of customer, competition, and product category. The analysis that considers firm, data, and model attributes of the sampled studies reveals that marketing actions’ effectiveness is higher when multichannel firms use digital advertising and price promotions in all distribution channels. Price discrimination across channels does not improve marketing actions’ effectiveness. Furthermore, marketing actions’ effectiveness depends on how digital advertising and price promotions are aligned with channel variety, channel richness, customer experience, market competitiveness, and product purchase infrequency.

Subjective performance evaluation could induce influence activities: employees might devote too much effort to pleasing their evaluator, relative to working toward the goals of the organization itself. We conduct a randomized field experiment among Chinese local civil servants to study the existence and implications of influence activities. We find that civil servants do engage in evaluator-specific influence to affect evaluation outcomes, partly in the form of reallocating work efforts toward job tasks that are more important and observable to the evaluator. Importantly, we show that introducing uncertainty about the evaluator's identity discourages evaluator-specific influence activities and improves bureaucratic work performance.

We investigate the link between exchange-traded funds and real investment. Cross-sectionally, higher ETF ownership is associated with an increased sensitivity of real investment to Tobin’s q and a heightened ability of stock returns to forecast future earnings. Inclusion of stocks in industry ETFs enhances investment-q sensitivity and implies greater incorporation of earnings information into prices prior to public releases. Greater nonmarket ETF ownership leads to increased (reduced) reliance of real investment on own (peers’) stock prices. Overall, the evidence is consistent with ETFs positively affecting real investment efficiency via greater flows of information.

With capital controls, the standard financial market transactions needed for currency carry trade are hard to implement. Using detailed trade data reported by both the mainland Chinese and Hong Kong’s governments, we present evidence that indirect currency carry trade likely takes place via round-trip reimports. We also show that greater state control in terms of more state-owned firms does not reduce such “carry trade by trucks.”

Recent research has shown that a CEO's personal experiences in his or her early days have an influence on his or her decision-making as an executive later on. Our study extends this emerging stream of research by examining how CEOs’ pre-career exposure to religion affects their firms’ risk-taking and subsequent innovation performance. Drawing upon developmental psychology research and imprinting theory, we argue that CEOs who have attended a religious college are more likely to develop or reinforce their risk-averse mentality. This carries over to their professional life when they are in a top management position, and it leads to less risk-taking behavior in their firms and ultimately a lower level of firm innovation. Using a large sample of U.S. publicly listed companies, we find strong support on our hypotheses: Firms managed by CEOs who attended a religious college tend to be less risk-taking; this effect is stronger when the firm has more board members with pre-career exposure to religion; in addition, the firm's risk-taking behavior mediates the negative relationship between CEO pre-career religious exposure and firm innovation. We discuss the implications of our study for the strategic leadership literature, firm's risk-taking, and innovation research.