Séminaires de Recherche

Mandatory Adoption of IFRS and Stock Price Informativeness

Comptabilité Contrôle de Gestion

Intervenant : Philip JOOS
Tilburg University

16 janvier 2009 - De 14h00 à 16h00


In this paper, we examine whether mandatory adoption of IFRS ameliorates firm
opacity and contributes to stock price informativeness. Using Dasgupta et al.’s (2007)
framework, we predict a decrease in synchronicity around the time of mandatory adoption of
IFRS, and a subsequent increase in synchronicity in the post-IFRS adoption period. Using a
sample of 2,173 mandatory IFRS adopters in 14 EU countries, we find stock return
synchronicity decreased in 2005 (the year of mandatory IFRS adoption), but subsequently
increased in the post-adoption years to levels higher than the pre-adoption period. We also
find synchronicity increases more in the post-IFRS adoption period when analyst activity is
higher. In contrast, we find synchronicity returned to pre-IFRS adoption levels during the
post-IFRS adoption period for firms with higher institutional ownership, which is consistent
with a continuing private information advantage enjoyed by institutional investors under the
IFRS regime. Overall, our evidence adds to the growing stream of literature on the
consequences of mandatory IFRS adoption.

A déterminer

Comptabilité et Contrôle de Gestion

Intervenant : Paul Pronobis
ESCP Europe Business School

19 octobre 2018 - HEC Paris - Salle T004 - De 14h00 à 16h00

The Visual Judgment of Performance

Management et Ressources Humaines

Intervenant : Chia-Jung TSAY
UCL School of Management

5 octobre 2018 - Bernard Ramanantsoa room - De 10h00 à 11h30

Social judgments and impressions are often made on the basis of minimal information. In the domain of music, people consistently report that the most important source of information in evaluating performance is sound; nonetheless, a first set of experiments demonstrated that people actually rely on visual information when making judgments about music performance. These findings were extended through additional sets of studies elaborating on the generalizability and persistence of these effects, such as in the judgment of entrepreneurial pitch competitions, analyst forecasts of firm performance, and in service operations in the food industry. Works in progress discuss the role of expertise in decision making and implications for organizational performance.

A déterminer

Comptabilité et Contrôle de Gestion

Intervenant : Kalle Kraus
Stockholm School of Economics

14 septembre 2018 - HEC Paris - salle T004 - De 14h00 à 16h00

Disclosure and Financing Choice: PIPEs vs. SEOs

Comptabilité et Contrôle de Gestion

Intervenant : Shiva Sivaramakrishnan
Rice University

15 juin 2018 - HEC Paris - salle X120 - De 14h00 à 16h00

Firms in competitive industries have natural incentives to avoid wide dissemination of proprietary information. We test this proprietary cost hypothesis (PCH) by examining the impact of corporate disclosure policy on a firm’s equity financing choice between Private Investments in Public Equity (PIPEs) and Seasoned Equity Offerings (SEOs). PIPEs offer firms a way to share proprietary information privately with a small group of investors. We employ several concentration and competition constructs to proxy for proprietary costs, but fail to find support to this hypothesis. Consistent with the literature, our results indicate that an “urgent need for cash” explains firms’ choice of PIPEs over SEOs. We also find that firms that choose SEOs over PIPEs are characterized by higher holdings by dedicated institutions, transient institutions and quasi-indexers. However, the PCH does not receive support even after controlling for these other determinants of the financing choice. Finally, we estimate a two-stage endogenous treatment-effect model to explain discounts associated with PIPEs and SEOs. Preliminary results indicate that discounts are lower when unobservables (e.g., private information) seem to influence the choice of PIPE over SEO.

Operating Leverage, Risk Taking and Coordination Failures


Intervenant : Matthieu Bouvard
Desautels Faculty of Management

14 juin 2018 - S125 - De 14h00 à 15h15


We study an economy with demand spillovers where firms' decisions to produce are strategic complements. Firms have access to an increasing returns to scale technology and choose their operating leverage trading off higher fixed costs for lower variable costs. Operating leverage raises the sensitivity of firms' profits to an aggregate labor productivity shock, thereby magnifying systematic risk. We show that firms take excessive risk as they do not internalize that higher operating leverage increases the likelihood of a coordination failure where output is infficiently depressed across the economy. More generally, our analysis suggests that individual risk-taking decisions aggregate into excessive output volatility in the presence of strategic complementarities among agents.

Make-and-Ally and Performance: Evidence from the Korean TV Drama Industry

Stratégie et Politique d’Entreprise

Intervenant : Evan Rawley
Associate Professor of Strategic Management & Entrepreneurship , Carlson School of Business- University of Minnesota

14 juin 2018 - Room #S218 - De 14h00 à 15h30

Make-and-ally governance, where integrated firms develop new products internally while simultaneously collaborating on new product development with suppliers, is becoming increasingly common in knowledge-based industries. Yet, there is little theory or evidence to explain the prevalence of this governance mode. In this paper, we propose that, when downstream commercialization is concentrated relative to upstream product development, make-and-ally governance improves market performance of knowledge-based products and facilitates value capture for the integrated firm. Using data from the Korean TV drama industry, we find qualitative and quantitative evidence that collaborative development between network companies and independent production companies improves viewership ratings of TV dramas. The results suggest that make-and-ally governance is driven partly by efficiency and partly by market power considerations.

Parent−Subsidiary Common Managers and Corporate Tax Planning

Comptabilité et Contrôle de Gestion

Intervenant : Xin Wang
Hong Kong University

8 juin 2018 - HEC Paris - salle T004 - De 14h00 à 16h00

As an interesting but neglected governance mechanism of a firm’s subsidiaries, corporate headquarters managers often take a position in significant subsidiaries (“parent-subsidiary common manager” hereafter), either as the board member or the operations manager. These parent-subsidiary common managers have direct access to divisional information and, therefore, possess greater knowledge useful for them to identify tax opportunities and coordinate tax-motivated activities across business units. Using senior executives’ subsidiary positions disclosed in Chinese listed firms’ annual reports, we examine the impact of parent-subsidiary common managers on corporate tax planning and find a lower effective income tax rate for firms appointing common managers. Additional analyses show that the tax-avoiding effect of common managers is more pronounced for firms with more intangible assets, more related-party transactions involving subsidiaries, and more diversified business. Moreover, we find stronger effects for those common managers who take a position in economically significant subsidiaries or subsidiaries entitled to preferential tax treatments. The effect is also stronger when common managers work as operations managers of the subsidiaries. Collectively, our study is the first to analyze the appointment of parent-subsidiary common managers and to show the impact of such an appointment on corporate decisions.

The Origins and Real Effects of the Gender Gap: Evidence from CEOs’ Formative Years∗


Intervenant : Mikhail Simutin
Rotman School of Management

7 juin 2018 - T004 - De 10h00 à 12h30


CEOs allocate more investment capital to male than female division managers. Using data from individual Census records, we find that this gender gap is driven by CEOs who grew up in male-dominated families—those where the father was the only income earner and had more education than the mother. The gender gap also increases for CEOs who attended all-male high schools and grew up in neighborhoods with greater gender inequality. The effect of gender on capital budgeting introduces frictions and erodes investment efficiency. Overall, the gender gap originates in CEO preferences developed during formative years and produces significant real effects.

Disclosure, Competition, and Learning from Asset Prices


Intervenant : Liyan Yang
Rotman School of Management

31 mai 2018 - T027 - De 14h00 à 15h15


This paper studies the classic information-sharing problem in a duopoly setting in which firms learn information from a financial market. By disclosing information, a firm incurs a proprietary cost of losing competitive advantage to its rival firm but benefits from learning from a more informative asset market. Firms' disclosure decisions can exhibit strategic complementarity, which is strong enough to support both a disclosure equilibrium and a nondisclosure equilibrium. Allowing minimal learning from asset prices dramatically changes firms' disclosure behaviors: without learning from prices, firms do not disclose at all; but with minimal learning from prices, firms can almost fully disclose their information. Learning from asset prices benefits firms, consumers, and liquidity traders, but harms financial speculators.

Rationalizing Outcomes: Mental-Model-Guided Learning in Competitive Markets

Stratégie et Politique d’Entreprise

Intervenant : Anoop Menon
Assistant Professor of Management , The Wharton School, University of Pennsylvania

31 mai 2018 - Room #T105 - De 13h30 à 15h00

This paper explores how competitive market interactions between agents with different mental models can lead to dysfunctional learning which can, in turn, have significant implications for an agent’s performance. We build a simulation model where two agents with different mental models about their demand environment compete over many periods, with the decisions of one period leading to market outcomes that are then used to recalibrate the mental models which, in turn, are used to make the decisions in the following period. Three model variants, exploring different mental models about the demand structure, the cost structure, and the market are studied. Dysfunctional learning occurs through dynamic mechanisms involving rationalization of observations within flexible mental models and misinterpretation of observations because of poor understanding of rival mental models. These mechanisms sometimes lead to distortion of an agent’s own initially correct mental model of the demand environment and to superior relative performance by the agent with an incorrect model of that environment. The insights from the models are used to interpret the ascension of GM over Ford in the late 1920’s, the slow adoption of radial tires in the U.S., and the rise of Nirma over incumbent Hindustan Lever in the Indian detergent market.