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We examine and compare the extent to which the reaction of investors to earnings announcements is influenced by a firm's governance profile and prevailing market conditions. We find that firms with better governance characteristics experience a larger initial reaction to both good and bad earnings announcements regardless of the prevailing sentiment and uncertainty conditions. However, the influence of governance is constrained to the announcement period. We demonstrate that changes in market uncertainty and/or investor sentiment are related to the post-earnings announcement drift. We also find that a major channel through which greater corporate governance influences the market response to unexpected earnings news is by lowering information uncertainty and so providing greater clarity of the implication of the news for firm value. Finally, we establish that two types of uncertainties (market and information) have very different influence on investor's response to information signals. JEL Classification: D81, G10, G14, G30, G32 [ABSTRACT FROM AUTHOR]

This study examines the relationship among analysts’ earnings forecast revisions, information uncertainty, and stock returns and provides new evidence that stock price drift occurs after analysts’ earnings forecast revisions. Using data from the Australian stock market over the period of 1992 to 2009, we find that the stocks with upward earnings revisions experience positive returns, while stocks with downward revisions have negative returns. The effect is more prominent in stocks with high information uncertainty. The results are robust after controlling for market conditions, seasonality, and risks. Our evidence supports the conservatism bias model that investors tend to underweight the public information, such as analysts’ earnings forecast revisions. Importantly, our evidence provides possible explanations about the violation of the efficient market hypothesis. Our results suggest that the conservative bias causes investors not to sufficiently update their beliefs and eventually results in subsequent return continuation as investors’ underreaction to analysts’ earnings forecast revision is stronger with higher information uncertainty. [ABSTRACT FROM PUBLISHER]

Many companies adopt concurrent engineering in their product-development projects in order to reduce time to market. Concurrent engineering requires careful management, since the uncertainty of transferred information leads to rework and renders a development process complex. Most of the existing studies on concurrent engineering have analyzed overlapping between two activities. The present study expanded the research scope by modeling the developmental process of the concurrent execution of multiple activities as the result of management decisions, the overlapping ratio, and the information transfer frequency. When multiple activities are overlapped, it is more difficult to model a development process, since the uncertainty of cascaded information has impacts on many activities. The quantitative model developed in the present study provides insights into the uncertainty of information and the product-development process. Based on the generalized process model for multiple-activity overlapping, the optimal decision to minimize project duration was considered. As a solution to the dilemma of the high computational burden of considering all feasible decision sets, this paper proposes a myopic heuristic. The project management heuristic proposed in this paper is intended to assist managers in the decision-making process, as well as reducing the intermediate deadlines in project main plan. [ABSTRACT FROM AUTHOR]

This laboratory experiment studies two-stage contests between political parties. In the first stage, parties run their primaries, and in the second stage, the winners of the primaries compete in the general election. The resource expenditures in the first stage by the winning candidates are partially or fully carried over to the second stage. Experimental results support all major theoretical predictions: the first-stage expenditures and the total expenditures increase, while the second-stage expenditures decrease in the carryover rate. Consistent with the theory, the total expenditures increase in the number of candidates and the number of parties. Contrary to the theory, however, expenditures in both stages of the competition exceed theoretical predictions. Disclosing information about the opponent's expenditures in the first stage increases the second-stage expenditures and decreases the first-stage expenditures. [ABSTRACT FROM AUTHOR]