Legal

15 Results

 

The Contaminating Effects of Building Instrumental Ties: How Networking Can Make Us Feel Dirty

Network ties are essential to advancement in organizations: they provide access to opportunities, political insight, and technical knowledge. Yet networking with the goal of advancement often leaves individuals feeling somehow bad about themselves—even dirty. The authors use field and laboratory data to examine how goal-oriented or instrumental networking influences individual emotions, attitudes, and outcomes, including consequences for an individual's morality. The authors argue that networking for professional goals can impinge on an individual's moral purity—a psychological state that results from a person's view of the self as clean from a moral standpoint and through which a person feels virtuous—and thus make him or her feel dirty. There are three main insights: First, the authors show the importance of a clear conceptual distinction between instrumental networking driven by individual agency versus spontaneous networking reflecting the constraints and opportunities of the social context. Second, the research establishes the relevance of moral psychology for network theory. Third, because people in powerful positions do not experience the morally contaminating effects of instrumental networking, power emerges from this research as yielding unequal access to networking opportunities, thus reinforcing and perpetuating inequality in performance. Read More

Bio-Piracy: When Western Firms Usurp Eastern Medicine

Raj Choudhury and Tarun Khanna examine the history of herbal patent applications, challenging a stereotype that characterizes Western firms as innovators and emerging markets as imitators. Open for comment; 3 Comments posted.

Resolving Patent Disputes that Impede Innovation

Technical standards both spur innovation and protect the innovators, but abuses in the intellectual property protection system threaten US competitiveness. Josh Lerner and Jean Tirole discuss remedies. Open for comment; 2 Comments posted.

Standard-Essential Patents

Standards play a key role in many industries, including those critical for future growth. Intellectual property (IP) owners vie to have their technologies incorporated into standards, so as to collect royalty revenues (if their patents dominate some of the functionalities embodied in the standard) or just to develop a competitive edge through their familiarity with the technology. However, it is hard to know in advance whether patents are complements or substitutes, i.e., how essential they are. Thus a major policy issue in standard setting is that patents that seem relatively unimportant may, by being included into the standard, become standard-essential patents (SEPs). In an attempt to curb the monopoly power that the standard creates, most standard-setting organizations (SSOs) require the owners of patents covered by the standard to grant licenses on fair, reasonable and non-discriminatory (FRAND) terms. Needless to say, such loose price commitments can lead to intense litigation activity. This paper constitutes a first pass at a formal analysis of standard-essential patents. It builds a framework in which essentialization and regulation functions can be analysed, provides a precise identification of the inefficiencies attached to the lack of price commitment, and suggests a policy reform that restores the ex-ante competition called for in the literature and the policy debate. Read More

What Shapes the Gatekeepers? Evidence from Global Supply Chain Auditors

Private gatekeepers, from credit rating agencies to supply-chain auditors, are supposed to provide unbiased, objective assessments of companies' internal operations, and such private assessments play a central role in contemporary regulatory regimes. While the impartiality of gatekeeping organizations has come into question over the past decade, little is known about what drives the decisions of the individual accountants, auditors, analysts, and attorneys who work at these organizations. Using data from a private, third-party social auditing firm that assesses global supply chain factories' adherence to corporate codes of conduct governing workplace conditions, this study reveals that external auditors' findings are shaped by a combination of economic incentives and social factors. The study highlights opportunities to design and staff audits to maximize their impartiality and credibility. Read More

Imperfect Information, Patent Publication, and the Market for Ideas

The market for ideas improves the innovation process by promoting division of labor between upstream inventors and downstream developers. Frictions such as asymmetric information and search costs may hinder the smooth functioning of the market and delay, or even block, mutually profitable transactions between buyers and sellers. In this paper, the authors study the effects of an important disclosure mechanism, the publication of patent applications, on mitigating these frictions and, thus, facilitating transactions in the market for ideas. In particular, they employ an important policy change in the American Inventors Protection Act (AIPA), which required that U.S. patent applications filed beginning on November 29, 2000 be published 18 months after the application date. Findings show that post-AIPA patents, on average, are licensed 8.5 months earlier than pre-AIPA inventions. This shortening of the licensing lag is economically significant, given the 20-year duration of U.S. patents, and can translate to millions of dollars in profits and licensing revenues. Read More

The Impact of Patent Wars on Firm Strategy: Evidence from the Global Smartphone Market

Patents and patent enforcement strategies have become an essential part of firms' competitive strategies: They are used as isolating mechanisms to protect intellectual property or as defense mechanisms to help obtain access to external innovations. Using data from the global smartphone market, the authors of this paper investigate the effect of escalated patent litigations—the so-called patent war—on firm strategy. The smartphone industry is a classic example of a business ecosystem, as participants in this industry are highly interconnected and this interconnectivity means that effects on some ecosystem participants are likely to extend to affect the rest. The authors' findings show that the efficacy of patent enforcement systems across markets plays a significant role in firm strategy during patent wars, and ultimately shapes the global competitive landscape. As the patent war intensifies, smartphone vendors, even those not directly involved in patent litigations, gradually shift their business foci to markets with weaker intellectual property (IP) rights protection. This shift, however, is attenuated for vendors with stronger technological capabilities and is more pronounced for vendors whose home markets have weak IP systems. Together, these changes shape the competitive landscape for platform competition. Read More

Why Do We Tax?

As the US presidential election bears down for November, it's prime time to ask how the income tax system could be improved. Assistant Professor Matthew C. Weinzierl suggests how. Open for comment; 20 Comments posted.

Looking Up and Looking Out: Career Mobility Effects of Demographic Similarity among Professionals

While women and racial minorities have increasingly crossed the threshold into professional service organizations, the path to the top remains elusive. Why do inequalities persist? McGinn and Milkman study processes of cohesion, competition, and comparison by looking at career mobility in a single up-or-out professional service organization. Findings show that higher proportions of same-sex and same-race superiors enhanced the career mobility of junior professionals. On the flip side, however, higher proportions of same-sex or same-race peers increased the likelihood of women's and men's exit and generally decreased their chances of promotion. This research highlights how important it is to look at both cooperative and competitive effects of demographic similarity when trying to address the problem of persistent underrepresentation of women and minorities at the highest levels in organizations. Read More

How to Fix a Broken Marketplace

Alvin E. Roth was a co-winner of the Nobel Prize in Economic Science this week for his Harvard Business School research into market design and matching theory. This article explores his research. Open for comment; 5 Comments posted.

Will I Stay or Will I Go? How Gender and Race Affect Turnover at ‘Up-or-Out’ Organizations

Gender and racial inequalities continue to persist at "up-or-out" knowledge organizations, making it difficult for women and minorities to advance to senior levels, professor Kathleen McGinn says. Read More

Do Legal Origins Have Persistent Effects Over Time? A Look at Law and Finance around the World c. 1900

A significant number of recent papers find legal origins to be strongly correlated with current indices of rule of law, financial development, the regulation of entry and labor, and the concentration of ownership, among other things. Few studies, however, have explored whether correlations between institutions and economic and financial outcomes hold in the past. For this reason, we cannot be certain that the alleged persistence of the effects of these institutions passes the scrutiny of history. This paper examines specifically the relationship between legal origins and financial development by analyzing countries' legal traditions and the extent of investor protections and financial development over time. Read More

What’s Law Got to Do with It: A Systems Approach to Management

Mainstream management theory often ignores the influence of law on the competitive environment and on the resources of the firm. The author attempts to spark greater academic interest in the legal aspects of management by proposing a systems approach to law and management "that explains how law affects the competitive environment, the firm's resources, and the activities in the value chain." Read More

Deep Links: Business School Students’ Perceptions of the Role of Law and Ethics in Business

The researchers spent more than a year eliciting twelve MBA students' thoughts and feelings about the role of law in starting and running a U.S. business. This research offers new insights into the ongoing debate about how best to educate the business leaders of tomorrow. More than a standalone course in business law or ethics, it would be wise for educators to use an approach that treats the role of law and business in the broader context of societal needs and norms. Read More

Using the Law to Strategic Advantage

Used proactively, corporate legal departments can give you a strategic advantage, argues HBS professor Constance Bagley. It's time for a new relationship between managers and legal. Read More