News at Smith

In Brief

May 01, 2011

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Flight Delays Cost Passengers Billions

Mike Ball, Orkand Corporation Professor of Management Science, associate dean of research, and co-director of the National Center of Excellence for Aviation Operations Research (NEXTOR), published a study showing that in 2007 passengers traveling by plane were delayed by more than 28,000 years, costing them $16.7 billion in lost time. In total, flight delays in the United States cost $32.9 billion each year.

The study was conducted by researchers at the University of Maryland, College Park; Massachusetts Institute of Technology; the University of California-Berkeley; George Mason University; and Virginia Polytechnic Institute. The research was funded by the Federal Aviation Administration. For more information, please contact mball@rhsmith.umd.edu

Right Message, Right Timing

Rebecca Hamilton and Rebecca Ratner, associate professors of marketing, published a study with co-author Debora Viana Thompson, PhD ’06, to examine the likelihood of consumers purchasing a product when they imagined themselves using it either more or less than other consumers. Participants were asked to rate how often they’d use products such as video games, running shoes, grills and calculators, after being shown ads suggesting a certain frequency of use—using running shoes “every day” versus “every week,” for example. They found that if consumers don’t think they can meet the pace of product use set by other consumers, they’ll be less likely to purchase the product.

“Outpacing Others: When Consumers Value Products Based on Relative Usage Frequency,” will be published in the Journal of Consumer Research in April 2011. For more information, contact rhamilto@rhsmith.umd.edu orrratner@rhsmith.umd.edu

Employee vs. Customer

Hui Liao, associate professor of management and organization, and her co-authors examined the causes of employee sabotage against customers in a recent study. 130 employees at a call center in China that provides customer service support for telephone and cell phone products were asked daily during a period of 10 working days to list any incidents when they had sabotaged customers that day. 88 percent of employees sabotaged customers at least once during the study period.

“Daily Customer Mistreatment and Employee Sabotage Against Customers: Examining Emotion and Resource Perspectives” is forthcoming from the Academy of Management Journal and is co-authored by Liao, Mo Wang, assistant professor of psychology; Yujie Zhan, doctoral candidate; and Junqi Shi, Peking University. For more information, please contact hliao@rhsmith.umd.edu

Banks Are Better

Vojislav Maksimovic, Dean’s Chair Professor of Finance, studied 2,400 private-sector firms in China to determine if a formal banking system—even a dysfunctional one—is more or less beneficial than none. Data from the World Bank’s 2003 Investment Climate Survey showed that firms which received bank financing had significantly better outcomes than those financed through informal means. This upends conventional wisdom (and past financial research) that small, unsecured loans from family and friends or from local moneylenders or strongmen have fueled China’s remarkable growth.

“Formal versus Informal Finance: Evidence from China” was co-authored by Maksimovic; Meghana Ayyagari, PhD ’04, George Washington University; and Asli Demirguc-Kunt, of the World Bank; and published in The Review of Financial Studies. This research was partially funded by a grant from the National Science Foundation. For more information, contact vmaksimovic@rhsmith.umd.edu.

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