Jason James Sandvik

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Journals/Publications

• Bol, J., LaViers, L., & Sandvik, J. (2024). The Trouble With Your Innovation Contests. MIT Sloan Management Review, 65(3).
• Mkrtchyan, A., Sandvik, J., & Zhu, V. Z. (2024). CEO Activism and Firm Value. Management Science, 70(10). doi:10.1287/mnsc.2023.4971
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  We investigate the increasingly common practice of chief executive officers (CEOs) taking public stances on social and political issues (CEO activism). We find that CEO activism stems from a CEO’s personal ideology and its alignment with investor, employee, and customer ideologies. We show that CEO activism results in positive market reactions. Furthermore, firms with CEO activism realize increased shareholdings from investors with a greater liberal leaning, who rebalance their portfolios toward these firms. Our results suggest that investors’ socio-political preferences are an important channel through which CEO activism affects equity demand and stock prices. Notably, CEOs are less likely to be fired when their activist stances generate positive market responses.
• Rau, P., Sandvik, J., & Vermaelen, T. (2024). IPO price formation and board gender diversity. Journal of Corporate Finance, 88. doi:10.1016/j.jcorpfin.2024.102629
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  Using a sample of U.S. IPOs from 2000–2019, we show that IPOs with at least one female director experience significantly greater underpricing on the first trading day. The effect is not attributable to the previously documented determinants of underpricing or other firm or director characteristics. The underpricing effect is the strongest after 2010—when pressures were placed on firms to diversify their boards—and the effect is mitigated in the very last years of the sample—where we find that gender-diverse board IPOs realize greater offer price revisions and final offer prices, relative to non-diverse board IPOs. The dynamic relation between board gender diversity and IPO price formation coincides with the timing of the diversity campaigns of BlackRock, State Street, and Vanguard, suggesting that investor demand for board gender diversity was not fully incorporated into IPO offer prices until this demand was widely publicized.
• Sandvik, J., & Xu, D. (2024). Employee responses to CEO activism. Journal of Accounting and Economics, 78(1). doi:10.1016/j.jacceco.2024.101701
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  We examine employee responses to CEO activism, the increasingly common practice of CEOs taking public stances on socio-political issues. CEO activism may bolster employees' identification with their organizations and strengthen shared beliefs among employees. Alternatively, CEO activism may alienate employees if CEO stances contrast with employees' ideologies. We find that employee satisfaction is higher when CEOs engage in activism that is aligned with employees’ ideologies. Furthermore, firms with CEO activism experience a net inflow of productive, ideologically-aligned inventors, which contributes to increased firm-level innovation. The improvements in employee satisfaction and innovation constitute an important channel that connects aligned CEO activism to increased firm value.
• Babenko, I., Bennett, B., Bizjak, J. M., Coles, J. L., & Sandvik, J. J. (2023). Clawback Provisions and Firm Risk. The Review of Corporate Finance Studies, 12(2), 191-239. doi:10.1093/rcfs/cfad003
• Bol, J., Laviers, L., & Sandvik, J. (2023). Creativity Contests: An Experimental Investigation of Eliciting Employee Creativity. Journal of Accounting Research, 61(1). doi:10.1111/1475-679X.12466
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  Running a contest can help managers elicit creative ideas from employees by providing employees with incentives to develop and share ideas that will help the firm. Little is known, however, about how contest design affects the outcomes of subjectively evaluated creativity-based contests. We conduct an experiment to investigate the impact of two contest design choices, the job role of the contest's evaluator, and the number of prizes that participants compete for, on employee participation behavior. We also examine how these contest design choices impact the creativity of the submitted ideas. We find that using a peer of the employees as an evaluator increases the number of ideas shared, but it does not impact the number of unique participants who enter the contest. In addition, we find that using peer evaluators leads to an increase in the creativity of the ideas. We find that awarding more prizes to participants does not increase overall participation, but it does increase the number of ideas shared by employees from underrepresented demographics. Awarding more prizes, however, reduces the creativity of the ideas. Together, these results show that contest design choices have an important impact on employee creative idea-sharing and that managers should carefully consider how to tailor contests to fit their firms' needs.
• Sandvik, J., Saouma, R., Seegert, N., & Stanton, C. (2021). Employee Responses to Compensation Changes: Evidence from a Sales Firm. Management Science, 67(12). doi:10.1287/mnsc.2020.3895
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  What are the long-term consequences of compensation changes? Using data from an inbound sales call center, we study employee responses to a compensation change that ultimately reduced take-home pay by 7% for the average affected worker. The change caused a significant increase in the turnover rate of the firm's most productive employees, but the response was relatively muted for less productive workers. On-the-job performance changes were minimal among workers who remained at the firm. We quantify the cost of losing highly productive employees and find that their heightened sensitivity to changes in compensation limits managers' ability to adjust incentives. Our results speak to a driver of compensation rigidity and the difficulty managers face when setting compensation.
• Sandvik, J. (2020). Board monitoring, director connections, and credit quality☆. Journal of Corporate Finance, 65. doi:10.1016/j.jcorpfin.2020.101726
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  Firms with poor board monitoring effectiveness receive lower credit ratings and larger credit spreads. I identify these effects by using director deaths as exogenous shocks to monitoring effectiveness. These effects are especially pronounced when firms are highly levered. Incremental decreases in monitoring effectiveness impact credit quality the most when a majority of the board members become co-opted by management and when firms are more likely to increase corporate risk.
• Sandvik, J., Saouma, R., Seegert, N., & Stanton, C. (2020). Workplace Knowledge Flows. Quarterly Journal of Economics, 135(3). doi:10.1093/qje/qjaa013
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  We conducted a field experiment in a sales firm to test whether improving knowledge flows between coworkers affects productivity. Our design allows us to compare different management practices and isolate whether frictions to knowledge transmission primarily reside with knowledge seekers, knowledge providers, or both. We find large productivity gains from treatments that reduced frictions for knowledge seekers. Workers who were encouraged to seek advice from a randomly chosen partner during structured meetings had average sales gains exceeding 15%. These effects lasted at least 20 weeks after the experiment ended. Treatments intended to change knowledge providers' willingness to share information, in the form of incentives tied to partners' joint output, led to positive - but transitory - sales gains. Directing coworkers to share knowledge raised average productivity and reduced output dispersion between workers, highlighting the role that management practices play in generating spillovers inside the firm.

Others

• Barrera, S., Dow, D., An, S., Griffin, C., & Sandvik, J. J. (2024, January). Arizona Fire Service and Law Enfrocement Recruitment Survey. https://morrisoninstitute.asu.edu/sites/default/files/2024-01/1%20-%20Arizona%20Fire%20Service%20and%20Law%20Enforcement%20Recruitment%20Survey%202024.pdf
• Barrera, S., Dow, D., An, S., Griffin, C., & Sandvik, J. J. (2024, January). Arizona Law Enforcement Retention Survey. https://morrisoninstitute.asu.edu/sites/default/files/2024-01/2%20-%20Arizona%20Law%20Enforcement%20Retention%20Survey%202024.pdf