Is it possible to establish the link between drug busts and the cryptocurrency market? Yes, we can

2023 | International Journal of Information Management | Citations: 1

Authors: Almaqableh, Laith; Wallace, Damien; Pereira, Vijay; Ramiah, Vikash; Wood, Geoffrey; Veron, Jose Francisco; Moosa, Imad; Watson, Alastair

Abstract: Following the rampant increase in Bitcoin prices, there has been a proliferation ... Expand

Abstract: Following the rampant increase in Bitcoin prices, there has been a proliferation of cryptocurrencies, which have become a major way of doing business across national boundaries. This paper investigates the link between cryptocurrency markets and drug trafficking activities. More specifically, we explore the impact of the announcement of 24 major drug busts on the systematic risk and return of the world cryptocurrency market. We deploy an event study methodology to estimate the abnormal returns associated with drug trafficking activities in the cryptocurrency market. We find that the relationship between the two is quite strong in the case of some cryptocurrencies, albeit weaker in others. However, we show that drug bust news tends to create uncertainty, and accordingly impart risk into cryptocurrency markets. This study confirms the predictions of convenience theories of crime as to the relative attractiveness of cryptocurrencies to criminals, and the extent to which not only general, but also their own future interests, sacrificed readily on the altar of accessibility. We highlight how when social and regulatory foundations are weak, criminal behaviour may overwhelm virtual spaces, margin­ alizing more orthodox businesses, no matter how altruistic the intentions of their founders. Collapse

Topics: cryptocurrency Bitcoin criminality price management Ethereum

Methods: event study longitudinal research robustness check literature study econometric modeling

Caught in an Expectations Trap: Risks of Giving Securities Analysts What They Expect

2023 | Organization Science | Citations: 0

Authors: Bascle, Guilhem; Jung, Jiwook

Abstract: Although recent research shows that there is mounting pressure on firms to achie ... Expand

Abstract: Although recent research shows that there is mounting pressure on firms to achieve earnings expectations of securities analysts, firms are far from being passive conformers; many firms proactively manage such pressure, particularly with earnings management tools. Yet why does the pressure to meet analyst expectations persist despite firms’ efforts to reduce it? To address the question, we develop an intertemporal model of the mutually reinforcing relationships between analyst expectations and firms’ strategic response, combining the behavioral theory of the firm and the concept of expectations trap. We argue that firms’ efforts to meet analyst expectations strengthen their salience as a predominant performance benchmark and, in doing so, ironically put them under greater pressure from analysts in three sequentially related steps—escalating future earnings expectations, imposing more severe penalties for failure to meet heightened expectations, and generating compensatory action for missed expectations. Our analysis, using data on more than 700 of the largest listed U.S. firms between 1986 and 2015, supports our arguments. Our study expands the scope of the behavioral theory of the firm, by demonstrating the increasing importance of performance feedback based on analyst expectations. Our study also contributes to the research on earnings pressure, by illuminating why the pressure persists despite firms’ efforts to reduce or evade it, and finally to the literature on strategic management of external expectations, by elaborating its unintended, long-term consequences. Supplemental Material: The e-companion is available at https://doi.org/10.1287/orsc.2021.1569. Collapse

Topics: strategic management organizational productivity Generally Accepted Accounting Principles IS downsizing accounting

Methods: longitudinal research statistical hypothesis test Compustat descriptive statistic robustness check

Theories: behavioral theory of the firm institutional theory

INNOVATION ON THE VENDOR SIDE - ANALYZING THE EFFECTS OF INNOVATION INITIATIVES ON OUTSOURCING PROVIDERS' PERFORMANCE

2023 | European Conference On Information Systems | Citations: 0

Authors: Beimborn, Daniel; Mildenberger, Andreas

Abstract: Innovation through outsourcing' describes a firm's strategy to receive innovati ... Expand

Abstract: Innovation through outsourcing' describes a firm's strategy to receive innovation by outsourcing IT or IT-intensive processes to more competent and innovative service providers who, in turn, do not only operate those activities but also improve and innovate for or on behalf of their clients. This strategy has gathered some attention from recent research, though it has mainly examined the client perspective, yet. We contribute to this sub-field of outsourcing research by analyzing vendors' strategies to improve their innovation capability and thus to be more innovative for their clients. Based on a longitudinal dataset of 136 outsourcing vendors, we analyze which innovationenabling initiatives are related to superior firm performance (in terms of revenue growth). We find that particularly employee-involving initiatives are promising: outsourcing vendors that have implemented, e.g., idea/innovation platforms that support employee-driven innovation, receive above-average revenue growth. Collapse

Topics: innovation management outsourcing organizational productivity financial performance absorptive capacity

Methods: regression analysis method statistical hypothesis test longitudinal research Student's t-test linear regression analysis

Theories: dynamic capabilities theory

Conversation Analytics: Can Machines Read between the Lines in Real-Time Strategic Conversations?

2023 | HICSS | Citations: 0

Authors: Chen, Y.; Rui, H.; Whinston, A.

Abstract: Strategic conversations involve one party with an informational advantage and t ... Expand

Abstract: Strategic conversations involve one party with an informational advantage and the other with an interest in the information. This paper proposes machinelearning based measures to quantify the degrees of evasiveness and incoherence of the informed party during real-time strategic conversations. The specific empirical context is the questions and answers (Q&A) part of earnings conference calls during which managers endure high pressure as they face analysts' scrutinizing questions. Being reluctant to disclose adverse information, managers may resort to evasive answers and sometimes respond less coherently due to increased cognitive load. Using data from the earnings calls of the S&P 500 companies from 2006 to 2018, we show that the proposed measures predict worse nextquarter earnings. Moreover, the stock market perceives incoherence as a negative signal. This paper contributes methodologically by developing two novel machinepowered measures to automatically evaluate behavioral cues during real-time strategic conversations. The proposed analytical tools are particularly beneficial to resource-constrained and informationally disadvantaged parties such as retail investors who may not be able to effectively trade on signals buried deep in unstructured conversational data. Collapse

Topics: database system artificial intelligence electronic finance missing data accounting

Methods: computational algorithm BERT deep learning machine learning next sentence prediction

Theories: theory of economic growth

The Returns to Nonmarket Strategies During Institutional Transitions: Investor Reactions to Actor and Tie Characteristics

2023 | Organization Science | Citations: 0

Authors: Gatignon, Aline; Gama, Marina A. B.; DeMello, Rodrigo B.

Abstract: We explain how investor perceptions of nonmarket strategies’ legitimacy, and the ... Expand

Abstract: We explain how investor perceptions of nonmarket strategies’ legitimacy, and thereby value, change during institutional transitions toward greater legal compliance. Indirect influence strategies should be better aligned with the transition and therefore become more legitimate than those associated with direct co-optation and control. Moreover, investors should assess this alignment based on two defining characteristics of firms’ nonmarket strategies, namely, the nonmarket actors and the ties involved. We, therefore, expect investors to value firms’ ties to nongovernmental organizations (NGOs) more than to political actors and ties formed via donations more than board ties. We test our hypotheses in the context of seven police raids that took place in Brazil in 2014; these raids launched “Operation Car Wash,” an anticorruption probe that signaled to investors a shift toward greater legal compliance at that point in time. Ultimately, we find that firms benefited the most when both nonmarket actors and ties were aligned with the institutional transition (i.e., NGO donations), and they suffered the most when both characteristics were misaligned (i.e., political board ties). Our findings integrate nonmarket strategies’ political and social facets by showing how actor and tie characteristics jointly explain their success or failure. They also contribute to explaining which firms will be better positioned to weather institutional transitions between legal capture and legal compliance. Funding: This work was supported by Getúlio Vargas Pesquisa-Fundação Getúlio Vargas; Govil Family Faculty Scholar Award; Wharton School, University of Pennsylvania. Supplemental Material: The online appendices are available at https://doi.org/10.1287/orsc.2022.1616. Collapse

Topics: database system corporate governance financial performance accounting corporate social responsibility

Methods: Wald test robustness check qualitative interview statistical hypothesis test theory development

Market Valuation of Artificial Intelligence Implementation Announcements

2023 | ACM SIGMIS Database | Citations: 0

Authors: Huang, Cheng-Kui (Tony); Lee, Yu-Tsung

Abstract: With the advent of artificial intelligence (AI), more and more enterprises have ... Expand

Abstract: With the advent of artificial intelligence (AI), more and more enterprises have begun developing AI to promote their own competitive advantage and increase their business value. In order to reveal the value-added results of AI implementation, this study adopts an event study methodology to capture the abnormal returns resulting from the announcement of AI implementation. Based on the empirical results of this study, in response to the announcement of AI implementation, we find significant positive abnormal returns on the event day. With respect to the grouping analysis, the results show significant differences in average cumulative abnormal returns between announcements with detailed information and those without detailed information. In addition, our findings present significant differences in average cumulative abnormal returns between IT-companies and non-IT companies on the event day. Ultimately, according to the content analysis, only one characteristic, the frequency of negative words, is modestly and negatively correlated with average cumulative abnormal returns. Collapse

Topics: artificial intelligence organizational value robotic information management Java

Methods: regression analysis method event study longitudinal research qualitative content analysis descriptive statistic

Theories: signaling theory

From Opaque to Accountable Governance: Investor Activism for Transparency in Social Media Amid Disruption in Cryptocurrency

2023 | International Conference on Information Systems | Citations: 0

Authors: Myeong, Jaeho; Jung, Miyeon; Auh, Seigyoung; Han, Sang Pil

Abstract: ... Expand

Abstract: Collapse

Topics: Twitter social media cryptocurrency blockchain Bitcoin

Methods: proportional hazards model survival analysis mediation analysis longitudinal research econometric modeling

Theories: uncertainty reduction theory

When Do Boards of Directors Contribute to Shareholder Value in Firms Targeted for Acquisition? A Group Information-Processing Perspective

2023 | Organization Science | Citations: 0

Authors: Pavićević, Stevo; Haleblian, Jerayr (John); Keil, Thomas

Abstract: We draw on group information-processing theory to investigate how target boards ... Expand

Abstract: We draw on group information-processing theory to investigate how target boards of directors may contribute to target value capture during the private negotiations phase in acquisitions. We view target boards as information-processing groups and private negotiations as information-processing tasks. We argue that target board meeting frequency is associated with increased processing—gathering, sharing, and analyzing—of acquisition-related information, which improves target bargaining and, ultimately, target value capture. We further posit that this value-enhancing effect of target board meeting frequency is more pronounced when target board composition improves the ability of target boards to process acquisition-related information. Finally, we expect that meeting frequency is more consequential for target bargaining and value capture when acquisition complexity imposes high information-processing demands on the target boards during private negotiations. Empirical evidence from a sample of acquisitions of publicly listed firms in the United States offers support for our group information-processing perspective on board contribution to shareholder value in firms targeted for acquisition. Funding: This work was supported by the Strategy Research Foundation [Dissertation Grant SRF-2015DP-0016]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2022.1643. Collapse

Topics: value creation IT career database system task complexity task productivity

Methods: regression analysis method statistical hypothesis test longitudinal research ordinary least square Kolmogorov-Smirnov test

Theories: information processing theory

Product Differentiation in IT Industries: The Interplay between M&As and In-House Innovation and Exploitative Innovation Orientation

2023 | Journal of the Association for Information Systems | Citations: 0

Authors: Qi, Kangkang; Han, Sumin; Jeong, Yeasung; Rhamati, Pouya; Susarla, Anjana; Sambamurthy, Vallabh

Abstract: Firms in IT industries are under constant competitive pressure from incumbent f ... Expand

Abstract: Firms in IT industries are under constant competitive pressure from incumbent firms and startups to offer innovative products and services. This study explores the effect of mergers and acquisitions (M&As) on firms' product differentiation in IT industries. The unique characteristics of IT industries, namely hypercompetition, distributed innovation, modularity of products, and the tacit nature of knowledge, make M&As an attractive mechanism to enable IT firms to stay competitive. Drawing on product differentiation theory, we hypothesize a positive effect of M&As on product differentiation and suggest that this relationship is more potent in firms with higher in-house innovation, an exploitative innovation orientation, and under high levels of industry turbulence. We test our hypotheses using M&A transactions from 1996 to 2016 and a unique 10-K textual analysis-based measure of product differentiation. Using the difference-in-differences identification strategy, the following findings are supported: (1) M&As lead to higher product differentiation, (2) in-house innovation capability and exploitation-oriented innovation strategy positively moderate the positive effect of M&As. These results, which are robust to endogeneities and other robustness tests, contribute to theory and managerial practice by shedding light on the role of M&As as an essential mechanism for product innovation and the complementary role of in-house innovation capability and strategy for firms that intend to take advantage of M&As for creating a competitive edge through differentiating their products and services from competitors. These findings have important managerial value, providing an alternative narrative to the current view on M&As in IT industries as a means of absorbing and dismantling the competition. served or serves on the editorial boards of Information Systems Research and MIS Quarterly. Her research has been funded by prestigious organizations such as the National Institute of Health (NIH).Vallabh "Samba" Sambamurthy is the Albert O. Nicholas Dean of the Wisconsin School of Business at the University of Wisconsin. He is a leading expert on how businesses compete in the digital economy. He has published his work in several leading journals and served on the editorial boards of premier academic journals, including two terms as editor-in-chief of Information Systems Research, and has held leadership roles in professional associations. Sambamurthy has garnered several recognitions for contributions to teaching, research, outreach, and mentoring. Collapse

Topics: product differentiation innovation management database system environmental uncertainty research and development

Methods: robustness check longitudinal research statistical hypothesis test difference in differences propensity score matching

Value of Autonomous Last-mile Delivery: Evidence from Alibaba

2023 | International Conference on Information Systems | Citations: 0

Authors: Wu, Lixia; Li, Peng; han, Brian Rongqing; Li, Meng; Zhang, Yanan

Abstract: This paper provides the first empirical evidence of consumer responses to auton ... Expand

Abstract: This paper provides the first empirical evidence of consumer responses to autonomous last-mile delivery using Alibaba's recent implementation in Chinese university campuses as a case study. The study leverages customer-level data from three universities over three years, employing a difference-in-differences (DID) approach combined with dynamic matching to estimate the impact of autonomous delivery adoption on order quantities. The results reveal a significant increase in the number of orders following autonomous delivery adoption with a 21% growth. The efficiency and flexibility of autonomous vehicles reduce consumers' travel costs, driving long-term usage and increased sales. However, the value of autonomous delivery diminishes when a fee is charged. The study contributes to our understanding of the value of autonomous last-mile delivery and its potential advantages over traditional courier delivery. Collapse

Topics: autonomous driving system logistics management logistics information system technology adoption business process management

Methods: longitudinal research difference in differences propensity score method computational algorithm propensity score matching