HEC Paris

About: HEC Paris is a education organization based out in Jouy-en-Josas, France. It is known for research contribution in the topics: Market liquidity & Entrepreneurship. The organization has 584 authors who have published 2756 publications receiving 104467 citations. The organization is also known as: Ecole des Hautes Etudes Commerciales & HEC School of Management Paris.

Quid Pro Quo in IPOs: Why Book-building is Dominating Auctions

Abstract: The book-building procedure for selling initial public offerings to investors has captured significant market share from auction alternatives in recent years, despite significantly lower costs in both direct fees and initial underpricing when using the auction mechanism. This Paper shows that in the French market, where the frequency of book-building and auctions was about equal in the 1990s, the ostensible advantages to the issuer using book-building were advertising-related quid pro quo benefits. Specifically, we find that book-built issues were more likely to be followed and positively recommended by the lead underwriters and were also more likely to receive 'booster shots' post-issuance if the shares had fallen. Even non-underwriters' analysts appear to promote book-built issues more, but only when their underwriters stood to gain from acquiring shares in future issues from the recommended firm's lead underwriter. Book-built issues also appeared to garner more press in general (but only after they had chosen book-building, not before). Yet, we do not observe valuation or return differentials to suggest these types of promotion have any value to the issuing firm. We conclude that underwriters using the book-building procedure have convinced issuers of the questionable value of advertising and promotion of their shares.

RunMyCode.org: A novel dissemination and collaboration platform for executing published computational results

Abstract: We believe computational science as practiced today suffers from a growing credibility gap — it is impossible to replicate most of the computational results presented at conferences or published in papers today. We argue that this crisis can be addressed by the open availability of the code and data that generated the results, in other words practicing reproducible computational science. In this paper we present a new computational infrastructure called RunMyCode.org that is designed to support published articles by providing a dissemination platform for the code and data that generated the their results. Published articles are given a companion webpage on the RunMyCode.org website from which a visitor can both download the associated code and data, and execute the code in the cloud directly through the RunMyCode.org website. This permits results to be verified through the companion webpage or on a user's local system. RunMyCode.org also permits a user to upload their own data to the companion webpage to check the code by running it on novel datasets. Through the creation of “coder pages” for each contributor to RunMyCode.org, we seek to facilitate social network-like interaction. Descriptive information appears on each coder page, including demographic data and other companion pages to which they made contributions. In this paper we motivate the rationale and functionality of RunMyCode.org and outline a vision of its future.

Financial Transaction Taxes, Market Composition, and Liquidity

Abstract: We use the introduction of a financial transaction tax (FTT) in France in 2012 to test competing theories on the impact of FTTs. We find no support for the idea that an FTT improves market quality by affecting the composition of trading volume. Instead, our results are in line with the idea that a lower trading volume reduces liquidity, and thereby market quality. Consistent with theories of asset pricing under transaction costs, we document a shift in security holdings from short-term to long-term institutional investors. More generally, our findings confirm that moderate aggregate effects on market quality can mask large adjustments made by individual market participants.

Encouraging Investors to Enable Corporate Sustainability Transitions: The Case of Responsible Investment in France

Abstract: This paper studies the case of the socially responsible investment (SRI) industry in France. This case accounts for how the SRI category and practices have successfully moved from the margins of the industry in the late 1990s to become mainstream over two decades. We bring to the forefront the importance of three complementary factors in the process of causing corporations to transition toward more sustainable businesses: the role of investors and, in particular, institutional investors; the importance of the presence of a clear category definition and of intermediary organizations, providing ratings, scores, and other calculative devices; and the role of governments and regulators. With other studies, this case stresses the fundamental influence of investors in how corporations manage sustainability transitions.

Does marketing and sales integration always pay off? Evidence from a social capital perspective

Abstract: Building on social capital theory, we view the marketing and sales interface as a set of inter-group ties and investigate how cross-functional relationships may facilitate the development of social capital associated with value creation. Our findings suggest that social capital embedded in marketing and sales relationships can inhibit a firm’s performance depending on the characteristics of its customers. Our results also demonstrate that managing the marketing and sales interface at different levels of customer concentration is critical to the success of a firm’s performance.