Polarization Affecting Asset Allocation in the Economy

Political polarization is hitting the U.S. economy in new and unexpected ways. It’s even affecting how assets are allocated. In a study by SMU Cox Finance Professor Tarun Patel and co-authors, political polarization was shown to impact the economy through a study of mergers. When firms and their employees had more similar political views, they were more likely to announce a merger, complete it faster and perform better on profitability measures. In more recent years, the impact of polarization has become more evident and costly. The antidote: get along and find common ground. 

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Emissions Disclosures by U.S. Manufacturers Shows Reductions: The Reasons Why Surprise

When Accounting Professor Sorabh Tomar of SMU Cox set out on his research journey about greenhouse gas emissions disclosures by facilities, he expected they would receive direct pressure from outside forces like investors, environmental groups and regulators to reduce emissions levels. Instead he found that the facilities, America’s plants and manufacturers, were more concerned with their local peers’ emissions disclosures. He found that public disclosure helped industries become more efficient and reduce greenhouse gas emissions.

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New Approach to Identifying Bellwether Firms: How They Influence the Future

The VIX index is the most renowned volatility index, gauging investor fear or uncertainty about the economy. In new research, Accounting Professor Sean Wang of SMU Cox and his co-authors identify a group of firms that move in tandem with the VIX and find that these firms essentially act as bellwether firms, microcosms of the market itself. These firms, mini-economies unto themselves, pass along information—for example, through their insider trading and earnings announcements—to the market about the economy and its future performance. It’s a big idea.

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Re-thinking Physical Spaces: Co-Location Helps Solve a Growing Mental Health Crisis and Workplace Issues Post-Pandemic

In new research by ITOM Professor Vishal Ahuja and co-authors, they show that proximity of physical spaces, that they refer to as co-location, matters. In the healthcare setting, co-location of providers in the same hospital or clinic can save money, but more importantly lives. With tech firms like Apple and Google purchasing new real estate to bring people back together, it’s not just about whether co-location matters to an organization but to whom it matters most and why.

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Financing Crypto Firm’s Projects: An Unlimited Token Offering?

Cryptocurrency markets are in their infancy says Information Technology and Operations Management Professor Rowena Gan of SMU Cox. The currencies are designed to develop technology firm projects and support their transactions in the future. Mature crypto projects are in short supply, however, and much of the breathless activity in cryptocurrencies has been speculative in nature. In novel research, Rowena Gan, with co-authors Gerry Tsoukalas and Serguei Netessine, shed light on the optimal design of “uncapped” initial coin offerings (ICOs), meaning that an unlimited quantity of tokens is offered on launch day. A goal for Gan is to help legitimate firms efficiently issue tokens to finance their technology projects and illuminate best practices.

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