[Photo Caption: Group photo of SMU and Tilburg professors at Joint School Conference]
Joint School Conference 2023 - Tilburg and SMU
Held on 16 and 17 June 2023, the Joint School Conference marked a much-anticipated return to an in-person format at Tilburg University, Netherlands.
The two-day conference showcased research paper presentations by professors from each university, with SMU represented by Assistant Professors of Accounting, Yin Wang, Grace Fan, and Samuel Tan.
Common Ownership and Advertising
Yin Wang, Assistant Professor of Accounting at SMU, presented on the topic of “Common Ownership and Advertising”, co-authored with Xiaotian Liu, Yaxuan Qi and Wenji Xu.
Their paper investigates the impact of common ownership on firms' advertising strategies. They develop a theoretical model where firms simultaneously choose output quantities and advertising expenditures, and the model predicts that the effect of common ownership on advertising depends on whether advertising has positive or negative spillover to rival firms. Their empirical analyses reveal a generally positive relation between common ownership and advertising intensity, but a negative relation in industries where negative advertising spillover is more prevalent. To establish a causal inference, the researchers employed difference-in-differences models using financial institution mergers and inclusions in the S&P 500 index as identification strategies. Consistent with the theoretical predictions, the effect of common ownership is more pronounced when the demand is more sensitive to advertising and when it is less sensitive to price changes.
Do Disruptive Climate Events Affect Environmental Regulator’s Monitoring?
Grace Fan, Assistant Professor of Accounting, and her co-author, Xi Wu, discussed how experiences with disruptive climate events impact the Environmental Protection Agency’s (EPA) monitoring activities in their paper “Do Disruptive Climate Events Affect Environmental Regulator’s Monitoring?”. Using a difference-in-differences research design and exogenous variation in the exposure of EPA regional offices to major hurricanes, they found that exposed EPA regulators increase their monitoring efforts at facilities in their jurisdictions that are located outside of the disaster zone (non-exposed facilities). This effect diminishes over time and is stronger for regulators located closer to the disaster and experiencing it for the first time. Their findings are consistent with exposure to salient climate events changing the EPA’s perception of the risk of non-compliance, highlighting the role of personal experience in shaping regulators’ monitoring activities and the subsequent effects.
Financial Reporting Quality of U.S. Hospitals
Samuel Tan, Assistant Professor of Accounting, presented on the topic of “Financial Reporting Quality of U.S. Hospitals”, co-authored with Cheryl Sim.
Using a nationwide sample of for-profit, nonprofit, and government hospitals, the researchers examine the quality of hospitals’ financial reports, which provide crucial information to owners, creditors, and policymakers. They find that hospitals have significantly greater discretionary accruals and are less conditionally conservative when benchmarked against matching public firms. The researchers established evidence of financial reporting quality (FRQ) contagion between hospitals in the same hospital system or the same city and also find that the low FRQ of for-profit hospitals relative to other hospitals is only partially mitigated by financial statement audits. Finally, they observe that hospitals’ discretionary accruals increased significantly during COVID-19 pandemic, consistent with financial distress being an influential determinant of measures of accruals quality in hospitals.
The conference also featured the following papers and proposals by the faculty at Tilburg:
“Private Information and the Granting of Stock Options” co-authored with Mary Ellen Carter, Rachel M Hayes, and Marlene A Plumlee (presented by Máté Széles, Tilburg University)
“Uncertain Earnings Betas” co-authored with Matthias Breuer and Atif Ellahie (presented by Harm Schütt, Tilburg University)
Research proposal on performance management (presented by Judith Künneke, Tilburg University)
The Joint Conference fostered a spirit of collaboration and provided a unique platform for the professors to share their expertise and exchange insights with one another.
Hye Sun Chang, Assistant Professor of Accounting at SMU, shared her thoughts regarding the conference, “The SMU-Tilburg conference provided a valuable platform to share our research with world-class researchers beyond Southeast Asia. This collaborative event has the potential to elevate SMU’s global visibility and open doors for extensive future partnerships with leading faculties.”
Visit this link to read about past Joint School Conferences.
Professors from both institutions discuss a paper presentation