Recently, two of our very own Whitman professors made headlines after conducting research and having their findings accepted into well-renowned publications. Lihong Liang, associate professor of accounting, and Dr. Burak Kazaz, associate professor of supply chain, both have reached intriguing conclusions in their respective fields. The significance of their results is essential for future research and studies, as well as beneficial for businesses, as it will help firms make decisions in their everyday operations.
Liang titled her paper “External Corporate Governance and Misreporting.” In this paper, Liang, along with co-authors William Barber (Georgetown University), Sok-Hyon Kang (George Washington University) and Zinan Zhu (National University of Singapore), investigates if there is a relationship between external government provisions and direct shareholder participation. To perform their study, they focused on the provisions that specifically dealt with shareholder participation. After their extensive research, it is apparent that the fewer restrictions on shareholders participation will lead to relatively less incidence of accounting restatements.
In Kazaz’s paper, entitled “Technical note – Price-setting newsvendor problems with uncertain supply and risk aversion,” Kazaz, with the help from his co-author Dr. Scott Webster (Arizona State University, formerly Syracuse University), studies how supply uncertainty of a perishable product can influence economic trade-offs and ultimately influence supply chain decisions. Together they discovered that uncertainty does not alter decisions when the source is demand based. However, risk aversion and uncertainty have a great impact on supply chain decisions when the root of the problem stems from supply fluctuations.
The authors developed a new elasticity measure to help answer the problems created through supply uncertainty. In the end, the research determined that a business will tend to order more of a good and price the commodity much higher when supply uncertainty is present. Kazaz and Webster’s desire to research into this topic further was stimulated by previous studies that explained how demand uncertainty led firms to do the opposite, order less and price lower. The results to this study will help firms that deal with any forms of uncertainty make better supply chain decisions and operate more efficiently.