Junior Management Science, Volume 7, Issue 4, September 2022

Exploring How Macroeconomic Factors Affect REITs and Evaluating Its Downside Risk – Empirical Evidence From China and the US

Xiaoyu Hu, Technical University of Munich (Master thesis)
Junior Management Science 7(4), 2022, 874-898

Real Estate Investment Trust (REIT) is considered as a financial instrument operated and managed by professional management teams based on a range of income-producing real estate. The focus of this thesis is on publicly traded equity REITs. There are four research questions that this thesis attempts to answer. How did REITs develop in the United States (US)? What are the critical factors that incentivized the Chinese government to promote REITs, and what is the progress? Are REITs a good hedge against macroeconomic risk factors? How can the downside risk of REITs be evaluated? To begin, the first two questions have been answered using the literature review methodology. The VAR model is constructed to evaluate the relation between the REIT market and macroeconomic factors. Ultimately, downside risk of REIT market is assessed by the GARCH(1,1)-VaR model based on the student’s t-distribution.

Keywords: Equity REITs; Macroeconomic risks; VAR; VaR; GARCH(1,1).

Moderation in Marketing Applications of Partial Least Squares Structural Equation Modeling (PLS-SEM)

Jonas Spengler, Otto von Guericke University of Magdeburg (Master thesis)

Junior Management Science 7(4), 2022, 899-931

This thesis investigates how current marketing research deals with simple moderation analysis in marketing applications of partial least squares structural equation modeling (PLS-SEM). In this context, different approaches to generate the interaction term as well as options of data treatment before analysis, among others, pose challenges to researchers. The goal of this thesis is therefore to highlight the most common sources of error through a review of 33 relevant empirical articles from the PLS-SEM context and to derive recommendations for research. Using a framework that shows how to preferably generate the interaction term, it is found that about 70% of the analyzed studies use a suboptimal approach. Furthermore, the product-indicator approach is the most frequently used but only in exceptional cases the optimal approach. Additionally, both the approach used as well as the effect sizes of moderation effects are generally rarely specified and finally uncertainties in the interpretation of effects in moderation analyses can be observed. This confirms the urgency of the need for educating researchers in terms of moderation analysis in the context of PLS-SEM to minimize common mistakes in the future that distort results of moderation analyses or make their meaning incorrect.

Keywords: Moderation analysis; interaction effect; moderator; PLS-SEM; Partial least squares structural equation modeling.

The normalizing power of digitalization in the world of work – An analysis based on Michel Foucault’s theory of power

Sebestyén András Huszár, Free University of Berlin (Bachelor thesis)
Junior Management Science 7(4), 2022, 932-944

Digitalization – a power that shapes the whole world and, in particular the world of work anew. Digitalization brings new rules, creates new conditions and establishes new standards. It has a strong normalizing effect. As Michel Foucault describes it in his work Discipline and Punish, normalizing is one of the predominant forms of power. Foucault’s theory of power provides a perspective particularly suited to understand the processes of digitalization. The aim of this paper is to identify the most prominent effects of the normalizing power of digitalization in the world of work. In order to reach this goal, a profound qualitative content analysis is conducted, where articles from the German news magazines Die Zeit and Der Spiegel are analyzed using the method of concept coding. The result of the paper is a comprehensive category system, which describes the complex phenomenon, how digitalization normalizes the world of work. Digitalization converts the local nature of the world of work into global (Globaler Charakter), creates flexible working conditions (Flexibilität) and introduces a new level of connectedness and surveillance (Transparenz und Kontrolle). The paper provides a detailed discussion of the main components of these three categories. Results of the paper show, that digitalization changed the world of work fundamentally through normalization, and employees encounter novel challenges and opportunities.

Keywords: Digitalization; Foucault; normalizing power; worker.

The Idiosyncratic Volatility Puzzle – Anomaly or Data Mining

Leon Kowalke, Leibniz University Hannover (Master thesis)
Junior Management Science 7(4), 2022, 945-985

In this study, I investigate the robustness of the idiosyncratic volatility puzzle to the configuration of the research design. Using the regression- as well as the portfolio-based concept, I start with the replication of the idiosyncratic volatility puzzle approving the findings of Ang et al. (2006). However, when idiosyncratic volatility is estimated from monthly data and a time window spanning 1 or 5 years, the puzzle vanishes, regardless of the research method employed. Similar result hold if only stocks with a market capitalization above the cross-sectional median or those with a price higher than 10$ are used. Independent of the weighting scheme, the puzzle is also absent in the regression-based context when the risk premia are estimated by generalized least squares weighting returns by the inverse of their variance estimates. The same finding is derived in the portfolio-based context by extending the holding period to 12 months or controlling for the past month maximum daily return.

Keywords: Idiosyncratic Volatility; Cross-section of stock returns; Predictability; Risk Premium; Robustness.

One User – Two Viewpoints? An Examination of Information Privacy Concerns from the Employee and Consumer Perspective

Marco Wall, Ludwig Maximilian University of Munich (Bachelor thesis)
Junior Management Science 7(4), 2022, 986-1000

This study aims to answer two questions about the investigation of privacy concerns in the use of video call applications: Firstly, it aims to find out how privacy concerns of users of these technologies differ in the work context from the private context. Secondly, this paper wants to discover the underlying cause for these differing concerns. To answer these questions, focus group interviews were conducted with users who use video call applications in both the business and personal contexts. The results of the qualitative research were presented visually using a thematic map. Users expressed great privacy concerns regarding the control of sensitive data. In addition, work behaviour and employment relationships are becoming more transparent, which raises more concerns. Employees in particular try to protect private, confidential data at work. This paper presents one of the first exploratory findings in the field of privacy research in the workplace.

Keywords: Information privacy; privacy concerns; online privacy; video call applications; workplace privacy.

Digital Financial Reporting – Consequences and Implications for the Use of the New Medium

Milan Schulze, Heinrich Heine University Düsseldorf (Master thesis)
Junior Management Science 7(4), 2022, 1001-1031

Changes and technological developments in business and society are effects of increasing digitization. New media and technologies within digital business models are gaining importance. The consequences of their usage represent opportunities, challenges, and risks for the digital transformation of companies. The transformation of analog information into a digital format, or the digitization in financial reporting, reaches another level of effectiveness as a new medium. Both the volume of published information and the timely availability of business data continue to increase, not least due to increasing requirements. This poses challenges and risks with regards to the analyzability of this information. The change to digitalized reporting using the new medium must be understood as change management, in that traditional business management thinking and action is digitally oriented and adaptability and consistent willingness to learn are established in a contemporary understanding of roles.

Keywords: Digitalization; Reporting; ESEF; XBRL.

The organization of future production work – Requirements and technical solution approaches

Jan Felix Csavajda, University of Stuttgart (Bachelor thesis)
Junior Management Science 7(4), 2022, 1032-1097

With a view to the industrial production of the future and Industry 4.0, the focus mostly lies on technology, while organization and the role of humans are less considered. The aim of this paper is to determine organizational requirements and performance indicators for future production. A quantitative empirical study is used to evaluate the relevance from a practical perspective. In addition, a collection of technological solutions illustrates the exemplary practical implementation of the organizational requirements. As a result, an ideal-typical organization of future production is presented. A central finding is that so far little attention is drawn to the areas of organization and humans in the context of Industry 4.0. Modern work and leadership concepts, consequent employee qualification, Lean Management 4.0, improved coordination, connectivity and transparency as well as the use of performance indicators are essential. For the successful implementation of technical Industry 4.0 solutions, the primary establishment of a basic organizational framework is mandatory. This work clarifies which concepts should be in the foreground in the future, also in order to secure competitiveness.

Keywords: Industry 4.0; production; organization; requirements; performance indicators.

Digital Innovation in Corporations: Deriving a Practical Framework for the Measurement of Success of Digital Innovation Units

Marcel Schemmel, Technical University of Munich (Master thesis)
Junior Management Science 7(4), 2022, 1098-1132

Confronted with entirely new challenges resulting from digital technologies, established corporations increasingly set up dedicated digital innovation units (DIUs) to foster digital innovation and to explore opportunities for the digital future. Although DIUs recently face criticism with regards to their performance and impact on the core organization, literature lacks in suitable approaches to assess the success of DIUs. Therefore, we derive a practical framework for the measurement of success of DIUs in the course of this research project. We develop this framework by identifying critical success factors (CSFs) and key performance indicators (KPIs). Subsequently, we merge our results with existing literature. To determine these CSFs and KPIs, we designed an explorative, qualitative-empirical case study research approach. The research design is based on a mixed-method approach that combines semi-structured interviews as core component with a supplementary survey. Conducting nine cross-industry case studies, we identified 16 CSFs and 38 objective related KPIs. Thus, the framework derived in this thesis contributes to practice and literature by addressing the existing gap in DIU and performance measurement research.

Keywords: Digital innovation units; performance measurement; critical success factors; key performance indicators; qualitative case studies.

The role of self-enhancement when using status incentives
in sales

Niclas Vogt, Ruhr University Bochum (Bachelor thesis)
Junior Management Science 7(4), 2022, 1133-1146

The aim of this study is to apply the social psychological theory of self-enhancement to the widespread use of status incentives in the corporate world. More specifically, the potential effect of self-enhancement triggered by the awarding of status incentives is examined based on a fictitious sales team. Special focus is placed on the resulting motivational effect. The research showed that status changes through status incentives (status manipulation) have a very strong effect on employees‘ motivational performance, because self-enhancement is influenced. The primary finding was that these status changes of individuals within a team may have ambivalent effects on overall motivational performance, partly because in team dynamics an increase in status of individual members is accompanied by the relative decrease in status of the other members. Among other effects, this changes the structure of social comparisons (self-enhancement theory) within the sales team, which possess strong motivational effects.

Keywords: self-enhancement; status incentives; sales; motivation.

Balancing player values in German professional football – A critical analysis of German GAAP

Malte Ludwigs, Heinrich Heine University Düsseldorf (Bachelor thesis)
Junior Management Science 7(4), 2022, 1147-1163

Rising transfer fees in professional football are causing an increasing influence of player transfers on the balance sheet of the clubs. However, proper accounting and valuation of player assets entails some ambiguities and problems in the context of accounting. The aim of the present work is to illustrate the accounting treatment of a player transfer in accordance with the provisions of the German Commercial Code. Furthermore, it is considered to what extent the accounting practice in football fulfils the basic purposes of accounting. At the beginning there is a presentation of the legal framework of player transfers. Subsequently, the rules for the recognition and measurement of player assets are explained in more detail in order to finally show which problems arise from the current accounting practice. The results show that clubs have to take into account additional football-specific items in addition to the general regulations of the German Commercial Code (HGB). This leads to a comprehensive regulatory construct that nevertheless leaves the clubs room for manoeuver in terms of balance sheet policy. The balance sheet item player assets therefore has only a limited significance with regard to the actual economic circumstances in the club.

Keywords: Accounting; Football; Player values; Player transfers.

Innovation Performance in Healthcare M&A: An Empirical Analysis

Philipp S.R. Voss, Technical University of Berlin (Master thesis)
Junior Management Science 7(4), 2022, 1164-1192

The relationship between mergers and acquisitions (M&A) and innovation in the healthcare sector (pharmaceuticals, biotechnology, medical devices, and life sciences) is investigated using a new self-generated dataset of 41 firms. Patents are used as proxy for innovation performance of acquiring firms. This work can also be seen as an extended replication study of Ahuja and Katila (2001) and Cloodt et al. (2006). The extension comprises of newly added variables relatedness of acquirer knowledge and acquisition experience. The findings are consistent with previous research. Non-technological M&A appear to have a negative impact on the acquiring firm’s innovation performance. The absolute size of acquired knowledge has a small positive effect. The relative size of acquired knowledge has a negative effect on the acquiring firm’s innovation performance. The relatedness of the target knowledge base has a curvilinear impact on innovative performance. The relatedness of acquirer knowledge has a negative effect on innovation performance. Finally, the effect of previous acquisition experience is ambiguous. The findings of this study indicate that the firms’ innovation performance can benefit from M&A by carefully selecting targets that provide the appropriate amount of “innovative” input.

Keywords: Mergers & Acquisitions; Innovation; Innovation Performance; Patents; Knowledge based view.