» RESEARCH REPORT

Why is Faculty Research So Important?
Hamid Beladi, Ph.D., Associate Dean of Research
IBC Bank Senior Faculty Fellow and Professor of Economics

Faculty research publications help support and further an academic institution's mission to carry out research, deliver teaching and facilitate learning. A strong record of published research by the faculty increases the prestige for not only that faculty member but also the university and their discipline.

Conducting research is essential for the scholarly development of any faculty member. Through this continuous research faculty members can not only disseminate their ideas in scholarly journals, but also in the classroom to the benefit of the students.
And, much like how football teams are ranked each season, a university's academic prestige is directly tied to the quantity of research published in high quality and leading academic journals.

As UTSA and the College of Business continue our quest to attain Tier One status, faculty research will be a vital component in achieving this goal.

Do Stock Heavy CEO Compensation Packages Lead to Lower Stock Returns?
When CEOs get paid more in stock and options, their company's stock returns have a tendency to be lower for the next 1-3 years, according to a study by John Wald, professor of finance.

"CEOs can reduce their firms risk if they have too much pay exposure in stocks and options, and lower risk implies lower returns," said Wald, who has taught at UTSA since 2006.

The study, "Too Much Pay Performance Sensitivity," appeared in the Review of Economics and Statistics this spring. Wald and his co-authors studied a large sample of firms for a 13-year period. The results noted a risk aversion effect in which CEOs mitigated firm risk in order to reduce the risk to their own wealth.

"We've seen the explosion in CEO pay in the last 20 years," said Wald, who has done numerous studies on CEO compensation. "And, those increases typically come from higher stock and options packages."

While this seems to contradict the reasons why boards of directors have structured compensation packages in this manner, Wald says that it is hard to ignore strong statistical evidence to support his case.

How to remedy this situation? Wald says that directors could focus more on cash bonuses and less on large stock and options packages to incentivize senior management.


Research Addresses Why Disabled People Have a Harder Time Finding Jobs
Discrepancies in employment rates between people with disabilities and those without disabilities may be related to the strength of their professional networks according to research by Mark Lengnick-Hall, professor of management, doctoral student Christopher Langford, and doctoral alumnus Mukta Kulkarni, Ph.D. '06.

The authors address their findings in a recent paper "How Do Social Networks Influence the Employment Prospects of People with Disabilities?" The paper appeared in the Employee Responsibilities and Rights Journal.

Researchers identified different types of professional contacts in an individual's network. These contacts include strong ties ("close relationships") and weak ties ("acquaintance relationships"). Although it is generally believed that strong professional ties have a greater impact on one's job search, research shows that acquaintance relationships are more important. Since individuals with disabilities have a harder time establishing acquaintance relationships, their employment prospects may be reduced.

"By conducting this in-depth study regarding people with disabilities and their professional networks, we hope to have an impact on closing the employment gap between those with disabilities and those without," said Lengnick-Hall.

The team of researchers suggests that a closer look at disabled individuals' use of professional networks is necessary. In examining this issue, future researchers will need to identify training and development opportunities to assist disabled individuals during the job search.


Does Being Rejected Increase Charitable Behavior?
Being rejected might not be good in the dating world, but it can be beneficial to charitable organizations according to a study published by L. J. Shrum, professor of marketing, and Jaehoon Lee, Ph.D. '11 in the Journal of Consumer Research.

The study examined two different types of social exclusion: being ignored versus being rejected—and their effects on conspicuous consumption and charitable behavior.

Researchers simulated an exchange in which participants felt they were being ignored or rejected as part of an online chat session. Immediately following this study, they were then quizzed on their preferences for various types of clothing brands and asked about their willingness to help or donate money in different situations.

"The conclusions were consistent across all of the experiments," said Shrum. "Being ignored increased an individual's preference for conspicuous consumption; being rejected increased one's propensity for charitable behavior."

According to the researchers, different types of social exclusion heighten different insecurities, which in turn results in different types of behavior to repair those insecurities.

COB Annual Report 2009

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