Welcome to the faculty research and publications collection from the University of Louisville College of Business. Our faculty are impassioned by their research. We proudly recognize our faculty for their outstanding achievements in research and publications.
Faculty Reasearch Listing
The following has received the Distinguished Research and Development Award from the International Association of Assessing Officers: Zurada, J., A. S. Levitan and J. Guan (2011) “A Comparison of Regression and Artificial Intelligence Methods in a Mass Appraisal Context,” Journal of Real Estate Resach (33) 3, pp. 349-387.
Research Roundup 2018
Faulds, David J., Mangold, W. G., Raju, P. S., & Valsalan S. (in press). The mobile shopping revolution: Redefining the consumer decision process.Business Horizons.
The use of mobile devices by consumers and the accompanying response by retailers is rapidly revolutionizing the retail environment. In the past, retailers have focused primarily on the outcome (to purchase or not to purchase) of the consumer decision process, but now mobile technologies give retailers the opportunity to more actively influence the entire consumer decision-making processes. The increasing use of mobile devices by consumers makes shopping a continuous rather than discrete activity that requires retailers to engage with their customers at critical touch points of the decision process in order to provide a more customer-centric experience. This change in focus from the decision outcome to the decision process signifies an important paradigm shift for the retailing industry. After an extensive review of the literature, we identify four pillars that form the foundation for the mobile shopping revolution and represent the essential ways and means through which retailers can engage with consumers during the decision process. We also discuss the different areas in which the pillars can enable retailers to achieve a sustainable competitive advantage in the mobile shopping era.
Ang, J. B., & Fredriksson, Per G. (in press). Culture, legal heritage and the regulation of labor. Journal of Comparative Economics.
According to cross-cultural psychologists, cross-country differences in individualism vs. collectivism constitute an important dimension of cultural variation. Legal-economic theorists argue that legal philosophies such as common law and civil law have developed differently over centuries and have persistent effects. In this paper, we argue that the effects of culture and institutions should not be analyzed in isolation from each other, as this disregards their interactions. We merge the two separate literatures on cultural attributes and legal origin theories, and derive a hypothesis regarding their joint effects on labor market regulations. We hypothesize that the effect of individualism on the political determination of labor regulations should be particularly pronounced in more market-oriented economic systems (as in British common law countries) compared to more rigid and bureaucratic state-centered systems (as in French civil law countries). Market oriented economies give individual effort and ability greater room to flourish, which in individualistic cultures yields weaker labor regulations. The effect of individualism should be smaller in state centered systems. Using data on the average rigidity of labor regulations during the years 1950–2004 in 86 countries, we find that the negative effect of individualism on the rigidity of labor regulations is enhanced by the presence of a common law legal system. In fact, individualism has no effect on the rigidity of labor market regulations in civil law countries. Analogously, the negative effect of common law legal origin on labor market regulations is found to be conditional on the level of individualism. Individualism and common law legal systems are complements in the determination of labor regulations.
Kwon, Mina, & Adaval, R. (in press). Going against the flow: The effects of dynamic sensorimotor experiences on consumer choice. Journal of Consumer Research.
Sensorimotor experiences of going against the flow can affect the choices consumers make. Eight experiments show that consumers who experience the sensation of going against the flow pick alternatives that are normatively not preferred (experiments 1a and 1b). These effects are evident only when the sensations are dynamic and self-experienced (experiments 2a and 2b), subjective feelings are elicited (experiments 4a and 4b), and no other objective, external norm information is supplied (experiment 5). Experiences of going against the flow typically involve both movement and direction and are represented in memory schematically. Re-experiencing these sensations leads to the activation of this schematic representation and elicits a feeling-based behavioral disposition to do something different, or to go against one’s initial inclination (experiment 3), leading participants to pick an option that is normatively not preferred.
Kroes, J. R., & Manikas, Andrew S. (2018). An exploration of ‘sticky’ inventory management in the manufacturing industry. Production Planning & Control, 2, 131-142.
Traditional models examining relationships between firm resources and revenues assume that the many expenses and asset holdings change in proportion to changes in demand. However, research has found that for many costs and assets assumed to be variable, the magnitude of a change in a cost or asset in proportion to a change in revenue is smaller during periods when revenue decreases compared to the change in the cost or asset when revenue increases. Costs and assets which behave in this manner have been denoted as ‘sticky’ costs or assets. This study examines if inventory in the manufacturing industry is managed in a ‘sticky’ manner and what implications inventory stickiness has on firm performance. Utilising firm panel data over a 25-year time window we find that inventory stickiness does exist amongst manufacturers and that it has negative implications for firm performance.
Manikas, Andrew S., Kroes, J. R., & Gattiker. T. F. (in press). Operational leanness and retail firm performance since 1980. International Journal of Production Economics.
Lean is one of the most pervasive and powerful paradigms in Operations and Supply Chain Management. As a theory, lean has been well tested in manufacturing. Lean in retail has received less attention. There is good reason to think that seminal constructs from lean, such as inventory slack reduction and capacity slack reduction, may explain a great deal of the variance in retail firm performance. Therefore this paper tests lean-based propositions pertaining to the relationships between inventory slack, capacity slack, market instability and firm market performance. Using retail firm data from a 35 year period, we find that lean thinking in its basic unadorned form helps explain retail performance remarkably well. From both a snapshot and quarterly difference perspective and regardless of whether we look at capacity slack or inventory slack, lean produces superior, lasting returns for retailers.
Munnich, Elizabeth L., & Parente, S. T. (2018). Returns to specialization: Evidence from the outpatient surgery market. Journal of Health Economics, 57, 147-167.
Technological changes in medicine have created new opportunities to provide surgical care in lower cost, specialized facilities. This paper examines patient outcomes in ambulatory surgery centers (ASCs), which were developed as a low-cost alternative to outpatient surgery in hospitals. Because we are concerned that selection into ASCs may bias estimates of facility quality, we use predicted changes in federally set Medicare facility payment rates as an instrument for ASC utilization to estimate the effect of location of treatment on patient outcomes. We find that patients treated in an ASC are less likely to be admitted to a hospital or visit an emergency room a short time after outpatient surgery. The findings in this paper indicate that factors other than patient and physician heterogeneity contribute to the observed returns to specialization in the ASC market.
In the News…
Elizabeth Munnich’s research was featured in a New York Times article on men entering the nursing profession: https://www.nytimes.com/interactive/2018/01/04/upshot/male-nurses.html
Sarker, S., Ahuja, Manju, & Sarker, S. (in press). Work–life conflict of globally distributed software development personnel: An empirical investigation using border theory. Information Systems Research. doi:10.1287/isre.2017.0734
While a key motivation for globally distributed software development (GDSD) is to harness appropriate human capital, ironically, scant attention has been paid to addressing the human resource management issues faced by information technology (IT) professionals involved in this context. One particularly challenging human resource issue is that of work-life conflict (WLC) of the IT professionals involved in GDSD, who routinely experience overlaps and conflicts between their work and personal life domains. While WLC
concerns are relevant in almost any contemporary environment, the GDSD context adds several layers of challenges arising from issues such as time differences, requirements instability, and the use of certain systems development methodologies. Recent research indicates that WLC issues go beyond individual concerns and are of strategic importance for talent retention. To develop a deeper understanding of these recognized challenges, we utilize Border Theory as a metatheoretical framework to develop and empirically test a model of organization-related and GDSD-related antecedents of WLC. In addition, we examine the impacts of WLC on job-related outcomes. Our study adopts a mixed-methods design, where an exploratory case along with a review of the literature is used to develop the research model. The model is then tested using a survey of 1,000 GDSD workers in three countries. We believe that our findings are not only of theoretical interest for the information systems discipline but also potentially helpful in improving the working conditions of the GDSD workforce.
Chao, Yong, Tan, G., Wong, A. C. L. (2018). All-units discounts as a partial foreclosure device. RAND Journal of Economics, 49(1), 155-180. doi:10.1111/1756-2171.12220
We investigate the strategic effects of all-units discounts (AUDs) used by a dominant firm in the presence of a capacity-constrained rival. Due to the limited capacity of the rival, the dominant firm has a captive portion of the buyer’s demand for the single product. As compared to linear pricing, the dominant firm can use AUDs to go beyond its captive portion by tying its captive demand with part of the competitive demand and partially foreclose its small rival. When the rival’s capacity level is well below relevant demand, AUDs reduce the buyer’s surplus.
Digan, Shaun Paul, Sahi, G. K., & Mantok, S., & Patel, P. C. (in press). Women’s perceived empowerment in entrepreneurial efforts: The role of bricolage and psychological capital. Journal of Small Business Management. doi:10.1111/jsbm.12402
Women’s entrepreneurial empowerment—perceived competence, self-determination, and ability in managing a firm as an entrepreneur—is important to women’s entrepreneurship in developing countries. Drawing on a sample of 369 women entrepreneurs from small and medium enterprises (SMEs) located in Gujarat, a western state in India, we find that women’s entrepreneurial empowerment is positively associated with firm revenues. Gains from empowerment could be further enhanced for women entrepreneurs managing resource constraints—through bricolage—and meeting the challenges of self-employment—through psychological capital. The present study contributes to the literature on women’s entrepreneurial empowerment and SME performance. Women’s empowerment and the bolstering effects of bricolage and psychological capital could help government agencies and non-government organizations devise programs and policies to improve the performance of women-owned SMEs in developing countries.
Ang, J. B., Fredriksson, Per G. (in press). State history, legal adaptability, and financial development. Journal of Banking & Finance. doi:10.1016/j.jbankfin.2018.02.009
A country’s cumulative experience with statehood influences its ability to consolidate power and create a capable bureaucracy. Longer statehood experience gives countries more time to adapt their laws to local needs, provided the legal system is adaptable. We find that, relative to British common law countries with the most flexible laws, German and Scandinavian civil law countries initially exhibit lower financial development. However, as their history of statehood grows longer, financial development improves in countries with adaptable laws such as the German and Scandinavian civil law countries. This is not the case in French civil law countries with more rigid legal systems. Our results mainly show no or at most a weakly negative effect of French civil law legal origin on financial development. We also explore how changes in stock market development over time, financial integration, and financial crisis are impacted by statehood experience, legal origins, and their interaction.
Chahal, H., Gupta, Mahesh, & Lonial, Subhash. (in press). Operational flexibility in hospitals: Scale development and validation. International Journal of Production Research. doi:10.1080/00207543.2018.1442941
The purpose of this paper is to develop and validate an operational flexibility construct that can serve as a general theory in operations management in the context of the hospital industry. The effects of management capability and competitive intensity on operational flexibility and performance relationships are also explored. We used data collected from a sample of 152 administrators of hospitals in the mid-west region of the USA and performed a systematic series of analyses. Following the transformation model, grounded in the fundamental and powerful concept of operations management, we develop a psychometrically validated, 11-item, three-dimensional (input, process, output) scale of operational flexibility (OF) construct for the hospital industry. As the degree of operational flexibility allowed in any transformation system is influenced by management capability, it is established as a complementary mediator in strengthening the OF-performance relationship in the presence of competitive intensity (i.e. moderator). The paper concludes with limitations and directions for future research.
Gupta, Mahesh, & Anderson, S. (in press). Throughput/inventory dollar-days: TOC-based measures for supply chain collaboration. International Journal of Production Research. doi:10.1080/00207543.2018.1444805
As the semiconductor industry moves away from vertical integration, performance measures play an increasingly important role to ensure effective collaboration. This paper demonstrates that the theory of constraints (TOC)-based measures, Throughput and Inventory Dollar-Days (T/IDD), induce autonomous supply chain (SC) links to function as a synergistic whole and thereby, improve the performance of the whole SC network significantly. We model an SC network of a well-known TOC case study using discrete event simulation and discuss managerial implications of these measures via a set of scenarios. The scenarios explain how these measures – without sharing sensitive financial data – allow members of an SC network to monitor both the effectiveness (TDD) and efficiency (IDD) of SC members and lead them to create win-win solutions following well-known TOC-based planning and control concepts. We conclude this paper by discussing some limitations of the proposed research and provide directions for future theoretical research.
Fyke, J., Trisler, B., & Lucas, Kristen (2018). A failure of courageous leadership: Sex, embarrassment, and (not) speaking up in the Penn State sexual abuse scandal. In J. Beggan & S. T. Allison (Eds.), Leadership and sexuality: Power, principles and processes (pp. 73-90). Northampton, MA: Edward Elgar.
On November 4, 2011, news of what would become known as the “Penn State scandal” broke after a grand jury report was released that documented former Penn State football coach Jerry Sandusky’s sexual assault of at least eight young boys. The investigation into these horrific crimes led to the revelation that leaders of Penn State actively chose to conceal the abuse for fear of bad publicity. In this chapter, we foreground the intersection of sexuality and leadership in this case. To analyze the failed communication within this case, we provide a focal narrative reconstructed from grand jury testimony and the Freeh Report. We demonstrate how the topic of sexuality—along with its taboos in workplaces generally, but especially within locker rooms, athletics, and among authority figures—led to watered-down and vague conversations, thereby exposing a lack of courage.
Fernandez, José, Gohmann, Stephan, & Pinkston, Joshua C. (in press). Breaking bad in bourbon country: Does alcohol prohibition encourage methamphetamine production? Southern Economic Journal. doi:10.1002/soej.12262
This article examines the influence of local alcohol prohibition on the prevalence of methamphetamine labs. Using multiple sources of data for counties in Kentucky, we compare various measures of meth manufacturing in wet, moist, and dry counties. Our preferred estimates address the endogeneity of local alcohol policies by exploiting differences in counties’ religious compositions between the 1930s, when most local‐option votes took place, and recent years. Even controlling for current religious affiliations, religious composition following the end of national Prohibition strongly predicts current alcohol restrictions. We carefully examine the validity of our identifying assumptions, and consider identification under alternative assumptions. Our results suggest that the number of meth lab seizures in Kentucky would decrease by 35% if all counties became wet.
Beeks, J. C., & Lambert, Thomas. (2018). Addressing externalities: An externality factor tax-subsidy proposal. European Journal of Sustainable Development Research, 2(2), online. doi:10.20897/ejosdr/81573
Nature is losing the war against capitalism and needs us to come to her defense in a way that may seem counter-intuitive. We, humans, have our ways of doing things and natural processes follow their own courses, often distinctly foreign to our inclinations. Our modern-day business practices are designed for the short term, are self-centered, tending toward precision and inevitably leading to environmental destruction. Natural processes, on the other hand, are intended for the long term, are generous, are highly imprecise and almost always lead to flourishing ecological systems. While humankind produces primarily negative externalities, nature produces almost exclusively positive externalities or no externalities at all. This paper discusses a way that both negative and positive anthropogenic externalities can be used to encourage ‘good consumption’ and to discourage ‘bad consumption’ for the benefit of natural ecological systems, human societies, family units, and our future generations.
Manikas, Andrew S., & Kroes, J. R. (in press). The relationship between lean manufacturing, environmental damage, and firm performance. Letters in Spatial and Resource Sciences. doi:10.1007/s12076-018-0206-5
Prior research has found mixed results of leanness, with a counter idea being that slack allows flexibility to improve firm financial performance. We first seek to confirm empirically that leanness in manufacturing does in fact contribute to both lower environmental damage and to improve firm financial performance. With increased awareness of global environmental issues, we incorporate environmental damage measures from Trucost to assess how they may affect firm performance and are affected by leanness. The measures of leanness are calculated based on publically available financial data from Compustat. Based on a final sample of 406 manufacturing firms representing 3594 firm-year observations from 2002 to 2013, the proposed relationships of leanness to firm outcomes and environmental damaged are investigated. A key finding of this study is that a firm should aim its lean efforts to reducing environmental damage, which in turn has more of an effect on improving financial performance than other lean initiatives.
Sarker, S., Ahuja, Manju, & Sarker S. (2018). The work–life conflicts of globally distributed software developers. LSE Business Review. London School of Economics and Political Science. http://blogs.lse.ac.uk/businessreview/2018/04/17/the-work-life-conflicts-of-globally-distributed-software-developers/