Spring 2022 Seminars | Leir Research Institute for Business, Technology, and Society

Date	Title/Speaker	Abstract
02/02	Transitory and Permanent Shock Transmissions between REITs and Other Assets: Evidence from Time-Frequency Decomposition and Machine Learning Jinghua Wang, NJIT	We evaluate the connectedness of asset returns and volatility using the time-frequency connectedness model and machine learning approach. The dataset consists of the forty-eight years of monthly indices on EREIT, MREIT, stock, commodity, and bond. The empirical results reveal that connectedness of asset returns occurs at high frequencies when markets speedily incorporate the new information. The innovations to EREIT and MREIT returns have a short-term impact on other assets. However, volatility connectedness among the assets is created at lower frequencies when markets slowly synthesize information. Therefore, shocks to the volatility of EREIT and MREIT decay gradually and spill over to the other three assets for long periods. We also find that the intensity of time-frequency connectedness of returns and volatility varies with business cycles and significant domestic and global non-recession episodes. The result of the algorithm-based machine learning model supports the dominance of EREIT in return and volatility transmission and further shows the commodities contribute more explanatory power to other assets in volatility transmission than in return transmission. The empirical findings have implications for strategic and tactical asset allocations and policy design for market stability.
02/09	Ingenuity of NASA: Designing the paradigm-changing Martian helicopter Raja Roy, NJIT	We explore the process through which an organization introduces a paradigm-changing innovation. We use NASA’s design of the Ingenuity helicopter—that flew on Mars for the first time on April 19, 2021, thereby creating history as the first controlled flight in the atmosphere of a celestial body in the solar system other than Earth—as our context. Our findings extend prior research on technological paradigm and paradigm-changing innovations. We uncover that the process, which starts with a trigger event, includes the organization’s identification of the uncertainty that are likely to affect the innovation, identification of the components that can mitigate those uncertainties, and mitigating component interdependencies to create the paradigm-changing innovation.
04/06	Antecedents to a unicorn venture’s IPO exit: The role of firm age Xi Zhang, PhD Candidate, MTSM; Raja Roy, Assistant Professor, MTSM; Shanthi Gopalakrishnan, Professor, MTSM	We investigate how a unicorn venture’s strategic decisions regarding diversification and acquisition affect its likelihood of an IPO and how these relationships can vary depending on firm age. Using data on unicorn ventures founded in the United States between 1983 and 2021, we find that a unicorn venture’s likelihood of an IPO has an inverted-U relationship with its age. We also reveal that younger unicorn ventures are more likely to go public with less diversification and more acquisitions, whereas older unicorn ventures are more likely to go public with greater diversification and fewer acquisitions. Our findings suggest that unicorn ventures have a window of opportunity to go public. We contribute to both entrepreneurship literature and population ecology research by bringing the two literature together to explore how firm age and ventures’ strategic decisions influence the IPO exit of a unicorn venture.

Date

Title/Speaker

Abstract

02/02

Transitory and Permanent Shock Transmissions between REITs and Other Assets: Evidence from Time-Frequency Decomposition and Machine Learning

Jinghua Wang, NJIT

We evaluate the connectedness of asset returns and volatility using the time-frequency connectedness model and machine learning approach. The dataset consists of the forty-eight years of monthly indices on EREIT, MREIT, stock, commodity, and bond. The empirical results reveal that connectedness of asset returns occurs at high frequencies when markets speedily incorporate the new information. The innovations to EREIT and MREIT returns have a short-term impact on other assets. However, volatility connectedness among the assets is created at lower frequencies when markets slowly synthesize information. Therefore, shocks to the volatility of EREIT and MREIT decay gradually and spill over to the other three assets for long periods. We also find that the intensity of time-frequency connectedness of returns and volatility varies with business cycles and significant domestic and global non-recession episodes. The result of the algorithm-based machine learning model supports the dominance of EREIT in return and volatility transmission and further shows the commodities contribute more explanatory power to other assets in volatility transmission than in return transmission. The empirical findings have implications for strategic and tactical asset allocations and policy design for market stability.

02/09

Ingenuity of NASA: Designing the paradigm-changing Martian helicopter

Raja Roy, NJIT

We explore the process through which an organization introduces a paradigm-changing innovation. We use NASA’s design of the Ingenuity helicopter—that flew on Mars for the first time on April 19, 2021, thereby creating history as the first controlled flight in the atmosphere of a celestial body in the solar system other than Earth—as our context. Our findings extend prior research on technological paradigm and paradigm-changing innovations. We uncover that the process, which starts with a trigger event, includes the organization’s identification of the uncertainty that are likely to affect the innovation, identification of the components that can mitigate those uncertainties, and mitigating component interdependencies to create the paradigm-changing innovation.

04/06

Antecedents to a unicorn venture’s IPO exit: The role of firm age

Xi Zhang, PhD Candidate, MTSM; Raja Roy, Assistant Professor, MTSM; Shanthi Gopalakrishnan, Professor, MTSM

We investigate how a unicorn venture’s strategic decisions regarding diversification and acquisition affect its likelihood of an IPO and how these relationships can vary depending on firm age. Using data on unicorn ventures founded in the United States between 1983 and 2021, we find that a unicorn venture’s likelihood of an IPO has an inverted-U relationship with its age. We also reveal that younger unicorn ventures are more likely to go public with less diversification and more acquisitions, whereas older unicorn ventures are more likely to go public with greater diversification and fewer acquisitions. Our findings suggest that unicorn ventures have a window of opportunity to go public. We contribute to both entrepreneurship literature and population ecology research by bringing the two literature together to explore how firm age and ventures’ strategic decisions influence the IPO exit of a unicorn venture.