Life-Cycle Asset Allocation with Ambiguity Aversion and Learning


Journal of Financial and Quantitative Analysis

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Départements : Finance, GREGHEC (CNRS)

Making a Niche: The Marketization of Management Research and the Rise of “Knowledge Branding”


Journal of Management Studies

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Départements : Comptabilité et Contrôle de Gestion, GREGHEC (CNRS)

Marking to Market and Inefficient Investment Decisions


Management Science

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Départements : Finance, GREGHEC (CNRS)

Mots clés : Marking to Market, Investment Decisions, Reputation, Agency Problem

We examine how mark-to-market accounting affects the investment decisions of managers with reputation concerns. Reporting the current market value of a firm's assets can help mitigate agency problems because it provides outsiders (e.g., shareholders) with new information against which the management's decisions can be evaluated. However, the fact that the assets' market value is informative can also have a negative side effect: Managers may shy away from investments that indicate conflicting private information and would damage their reputation. This effect can lead to inefficient investment decisions and make marking to market less desirable when market prices are more informative

Non-additivity in accounting valuation: Theory and applications



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Départements : Comptabilité et Contrôle de Gestion, GREGHEC (CNRS)

Mots clés : Choquet capacities, Goodwill, Growth options, Non-additive accounting-based valuation, Productive efficiency, Synergies

This paper has three objectives. First, to introduce a theoretical solution to the issue of non-additivity between assets in place, relying on an accounting-based valuation approach. Second, to explain how such an approach can be implemented empirically by measuring synergies between assets. Third, to present the properties of this non-additive valuation technique. We use Choquet capacities, that is, non-additive aggregation operators, to measure the interactions between assets and apply our methodology to a sample of US firms from the capital goods industry. To operationalize our approach we examine the relationships between synergies-captured by Choquet capacities-and the market-to-book ratio (proxying for growth options), and show how interactions between assets are consistently linked to a firm's market-to-book ratio. We also measure firm-specific productive efficiency relative to the industry and firm size. For large firms, efficiency, as defined by our approach, is positively associated with higher future operating cash flows. For small firms, efficiency is positively associated with higher future sales growth. We document that the non-additive approach appears to be better able to identify expected relationships between efficiency and future performance than a simpler approach based on the market-to-book ratio. © 2018 Accounting Foundation, The University of Sydney

Organization Design, Proximity, and Productivity Responses to Upward Social Comparison


Organization Science

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Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : Incentives, Social Comparison Costs, Envy, Productivity, Organization Design

We investigate the mechanisms that shape social comparison in organizations and generate socialcomparison costs. In particular, we focus on heterogeneity in the strength and type of incentivesand argue that, from an efficient design perspective, such variance in rewards is a double edgedsword. While the sorting and incentive effects that result may increase productivity, the socialcomparison processes that arise may dampen it. We posit that the mechanisms underlying thesebehavioral costs are shaped not only by the magnitude of reward variance, but by the formal andinformal design elements shaping the distance of advantaged peers. In other words, the moreproximate socially, structurally or geographically are those to whom one socially compares, thelarger the behavioral response. Empirically, we use an unanticipated event during which outlets ofa bank, previously operating under essentially homogenous incentives, were assigned totournament groups with differing ex ante probabilities of winning a prize—an event that increasesvariance in awards and hence generates an impetus for social comparison. We find that units withmore socially, geographically, and structurally proximate peers assigned to ‘advantaged’tournament groups decreased their productivity. We discuss implications of these results fororganizational design and boundaries

Priority optimization and make-to-stock/make-to-order decision in multiproduct manufacturing systems

K. Hadj Youssef, C. VAN DELFT, Y. Dallery

International Transactions in Operational Research

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Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : make-to-stock (MTS); make-to-order (MTO); priority level; heterogeneous multiproduct produc-tion/inventory system; queuing model

We consider a single-stage multiproduct manufacturing facility producing a large number of end products.In order to reduce overall inventory costs, an efficient approach is to produce some items according to amake-to-stock (MTS) policy and others according to a make-to-order (MTO) policy. Items priority levelsplay a key role in the optimal MTO/MTS decisions for such typical large-scale systems. To tackle this issue,the manufacturing facility is modeled as a multiproduct multipriority classes queuing system. We proposea general optimization procedure that selects near-optimal priority classes, gives the associated flow controlmode (MTO or MTS) for each product, and provides a lower bound and an upper bound with respect to theoptimal cost. First, we illustrate efficiency of our optimization procedure for this class of nonlinear integerprograms via several examples and by a numerical analysis, including a comparison with two alternativeheuristics given in the literature. In addition, we provide managerial insights by exhibiting, under variousparameter settings, the significant impact of an efficient priority level allocation among items on the inventorycosts and on optimal splitting between MTO and MTS product

Re-Thinking the CSP-CFP Linkage: Analyzing the Mechanisms Involved in Translating Socially-Responsible Behavior to Financial Performance


Advances in Strategic Management

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Départements : Comptabilité et Contrôle de Gestion, GREGHEC (CNRS)

Reinforcing the Public Law Taboo: A Note on Hellenic Republic v Nikiforidis


European Law Review

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Départements : Droit et fiscalité, GREGHEC (CNRS)

Mots clés : mandatory rules, EU private international law, Rome I Convention, Rome I Regulation

This article hinges on the preliminary ruling rendered by the Court of Justice of the European Union (ECJ) (Grand Chamber) on 18 October 2016 and the related judgment of the German Federal Labour Court of 26 April 2017 in the Nikiforidis case to investigate an area of private international law that is undergoing a substantial development: overriding mandatory provisions. In Nikiforidis, the ECJ excluded that two Greek laws cutting the salary of public employees may be enforced against a teacher working in Germany for the Greek government under an employment contract governed by German law. The question addressed to ECJ was whether said laws were “overriding mandatory provisions” according to the Rome I Regulation. The court denied it, and left to the referring court to determine whether they could nevertheless operate “as matter of fact” under the governing law. This article explains how the ECJ’s conclusion has broader implications by regulating third countries’ interference in international business transactions. Starting with an analysis of the case, the article examines the history and nature of overriding mandatory provisions under EU private international law and argues that the solution embraced by the ECJ leaves room to uncertainty and unpredictability in the operation of foreign mandatory provisions

Repeated games with public deterministic monitoring


Journal of Economic Theory

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Départements : Economie et Sciences de la décision, GREGHEC (CNRS)

Seeking and Avoiding Choice Closure


Journal of Consumer Research

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Départements : Marketing, GREGHEC (CNRS)