Is Support for Small Business Misplaced?
| Published: | February 1, 2012 |
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| Feature: | What Do YOU Think? |
| Forum: | open for comment; 25 Comments posted |
Forum Open Is support for small business overhyped as a panacea for our economic troubles? Recent research suggests the advantages of bigness when it comes to employment and economic development. If so, asks Professor Jim Heskett, what does this mean for government policy?
A Few Firms Have Outsized Influence in D.C.
| Published: | January 25, 2012 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 4 Comments posted |
New research by Harvard Business School Associate Professor William R. Kerr suggests the number of companies affecting government policy through lobbying may be smaller—but more powerful—than previously thought.
What Do Development Banks Do? Evidence from Brazil, 2002-2009
| Authors: | Sergio G. Lazzarini, Aldo Musacchio, Rodrigo Bandeira-de-Mello, and Rosilene Marcon |
|---|---|
| Published: | January 24, 2012 |
| Paper Release Date: | December 2011 |
| Feature: | Working Papers |
Private firms in developed and developing markets find themselves competing with the so-called "national champions"—private and state-owned enterprises that receive entitlements, mostly trade protections and/or subsidized credit from the government. Most of these national champions get support by proposing long-term projects with large capital investment that would usually not be easy to fund using private capital. This paper, written by Research by Sergio G. Lazzarini, Aldo Musacchio, Rodrigo Bandeira-de-Mello, and Rosilene Marcon, uses evidence from Brazil to look at what happens to firm performance, investment, and financial expenditures when companies get subsidized credit from the Brazilian National Bank of Economic and Social Development, known as BNDES.
What Do Development Banks Do? Evidence from Brazil, 2002-2009
| Authors: | Sergio G. Lazzarini, Aldo Musacchio, Rodrigo Bandeira-de-Mello, and Rosilene Marcon |
|---|---|
| Published: | January 24, 2012 |
| Paper Release Date: | December 2011 |
| Feature: | Working Papers |
Private firms in developed and developing markets find themselves competing with the so-called "national champions"—private and state-owned enterprises that receive entitlements, mostly trade protections and/or subsidized credit from the government. Most of these national champions get support by proposing long-term projects with large capital investment that would usually not be easy to fund using private capital. This paper, written by Research by Sergio G. Lazzarini, Aldo Musacchio, Rodrigo Bandeira-de-Mello, and Rosilene Marcon, uses evidence from Brazil to look at what happens to firm performance, investment, and financial expenditures when companies get subsidized credit from the Brazilian National Bank of Economic and Social Development, known as BNDES.
Private Meetings of Public Companies Thwart Disclosure Rules
| Published: | January 16, 2012 |
|---|---|
| Feature: | Research & Ideas |
| Forum: | open for comment; 6 Comments posted |
Despite a federal regulation, executives at public firms still spend a great deal of time in private powwows with hedge fund managers. Eugene F. Soltes and David H. Solomon suggest that such meetings give these investors unfair advantage.
The Evolving Basis for Legitimacy of the World Trade Organization: Dispute Settlement and the Rebalancing of Global Interests
| Author: | Arthur Daemmrich |
|---|---|
| Published: | January 10, 2012 |
| Paper Release Date: | December 2011 |
| Feature: | Working Papers |
The WTO is reconfiguring people's relationships to goods and services by facilitating trade and the consequent conversion of goods and ideas into property, including ones previously gifted or kept local. Unsurprisingly, there has been considerable opposition from the losers in the free trade system and attendant challenges to the legitimacy of the WTO. Arthur Daemmrich argues that understandings of legitimacy change over time, especially as organizations like the WTO interact with organized interests, including member countries and outside NGOs. He provides a brief history of the WTO as an organizational entity managing the institution of free trade, and a case study of a lengthy international trade dispute between Brazil and the United States over agricultural subsidies generally and cotton subsidies in particular. At the WTO, he writes, an important shift has taken place from the strategy of building organizational legitimacy through expanding membership to institutional deepening via the dispute process. Thus the WTO has become one of a few key sites for working out how knowledge claims will be formulated, framed, and validated on the international level.
Where Green Corporate Ratings Fail
| Published: | January 6, 2012 |
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| Feature: | Op-Ed |
| Forum: | open for comment; 7 Comments posted |
Many companies receiving high marks in environmental sustainability are hurting the planet in other ways, write professor Michael Toffel and executive Auden Schendler. Here's where green rankings fall short.
Published in 2011
Greater Fiscal Integration Best Solution for Euro Crisis
| Published: | December 6, 2011 |
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| Feature: | Views on News |
| Forum: | open for comment; 1 Comment posted |
Ministers and central bankers are working to solve the debt crisis that threatens the European integration project. Is there hope? There is reason to be optimistic, according to Harvard Business School's Dante Roscini, a former investment banker.
The Dynamics of Firm Lobbying
| Authors: | William R. Kerr, William Lincoln, and and Prachi Mishra |
|---|---|
| Published: | November 18, 2011 |
| Paper Release Date: | October 2011 |
| Feature: | Working Papers |
Lobbying is a primary avenue through which firms attempt to change policy in the United States, with total expenditures outnumbering campaign contributions by a factor of nine. While lobbying by businesses is a frequently debated issue, there has been little systematic empirical evidence on these behaviors at the firm level. This paper is one of the first to begin to fill this gap. To do so, the researchers constructed an empirical model of lobbying behavior of publicly traded, US-headquartered firms between 1998 and 2006. They also looked in depth at a specific policy shift that has been the subject of significant public debate: the dramatic decline in the limit on H-1B visas that occurred in 2004. Findings show that the decline in the limit on H-1Bs did not induce new firms to lobby that were not previously lobbying on other issues. The decline did, however, significantly shift lobbying resources towards high-skilled immigration issues amongst firms that had lobbied previously for other issues. Moreover, the manner in which this shift occurs among firms already lobbying indicates little constraint on adjustments across issues important for firms.
Historical Trajectories and Corporate Competences in Wind Energy
| Authors: | Geoffrey Jones and Loubna Bouamane |
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| Published: | October 18, 2011 |
| Paper Release Date: | May 2011 |
| Feature: | Working Papers |
Analyzing developments in the wind turbine business over more than a century, Geoffrey Jones and Loubna Bouamane argue that public policy has been a key variable in the spread of wind energy since the 1980s, but that public policy was more of a problem than a facilitator in the earlier history of the industry. Geography has mattered to some extent, also: Both in the United States and Denmark, the existence of rural areas not supplied by electricity provided the initial stimulus to entrepreneurs and innovators. Building firm-level capabilities has been essential in an industry which has been both technically difficult and vulnerable to policy shifts.
Decoding Insider Information and Other Secrets of Old School Chums
| Published: | August 29, 2011 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 1 Comment posted |
Associate Professors Lauren H. Cohen and Christopher J. Malloy study how social connections affect important decisions and, ultimately, how those connections help shape the economy. Their research shows that it's possible to make better stock picks simply by knowing whether two industry players went to the same college or university. What's more, knowing whether two congressional members share an alma mater can help predict the outcome of pending legislation on the Senate floor.
Managing Political Risk in Global Business: Beiersdorf 1914-1990
| Authors: | Geoffrey Jones and Christina Lubinski |
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| Published: | August 16, 2011 |
| Paper Release Date: | July 2011 |
| Feature: | Working Papers |
After the outbreak of World War 1, management of political risk became a central concern for firms, especially those operating internationally. These risks were on many levels, from expropriation to exchange controls and other economic policies. German firms, which had flourished during the second industrial revolution of the late nineteenth century, and enthusiastically expanded internationally, found themselves especially exposed to such risks. Focusing on one such firm, Beiersdorf, a German-based pharmaceutical and skin care company (and, during the Nazi years, a so-called Jewish business), the authors examine corporate strategies of political risk management during the twentieth century, especially the volatile years of Nazi Germany. The history of Beiersdorf highlights areas of managerial discretion. Faced by the worst of all worlds, the firm survived and was able, albeit at great cost, to rebuild its business.
HBS Faculty Views on Debt Crisis
| Published: | August 10, 2011 |
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| Feature: | Views on News |
| Forum: | open for comment; 27 Comments posted |
In the midst of the US debt crisis, Harvard Business School faculty offer their views on what went wrong and what needs to be done to right the US ship of state.
How Firms Respond to Mandatory Information Disclosure
| Authors: | Anil R. Dosh, Glen W.S. Dowell, and Michael W. Toffel |
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| Published: | August 9, 2011 |
| Paper Release Date: | July 2011 |
| Feature: | Working Papers |
Companies are facing increasing pressure to reveal information about their operations, including their environmental performance. This research examines which types of organizations are especially likely to reduce their pollution levels once they face mandatory disclosure requirements. Research conducted by Anil Doshi and Michael Toffel of Harvard Business School, and Glen Dowell of the Johnson School of Management at Cornell University compares the responses of companies based on their proximity to headquarters and to corporate siblings, organizational size and the density of their surrounding communities, and whether they are part of publicly- or privately-held firms.
An Exploration of Optimal Stabilization Policy
| Authors: | N. Gregory Mankiw and Matthew C. Weinzierl |
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| Published: | August 5, 2011 |
| Paper Release Date: | May 2011 |
| Feature: | Working Papers |
The researchers explore alternative policy responses to a recession caused by a decline in aggregate demand, the situation affecting the global economy over the last several years. They show that policies that stimulate the economy at the lowest budgetary cost may not be the best policies in terms of well-being, as well-being depends not only on the level of activity but also on the composition of it (due to consumption, investment, and government spending). In their model of the economy, monetary policy is the best response, and if it is sufficient to stop the recession, government spending ought to move in the same direction as private spending. If monetary policy is insufficient or restricted, fiscal policy should try to replicate what monetary policy would do. If that option, too, is restricted, conventional policies that increase government spending are merited.
Tax Policy and the Efficiency of US Direct Investment Abroad
| Authors: | Mihir A. Desai, C. Fritz Foley, and James R. Hines Jr. |
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| Published: | August 3, 2011 |
| Paper Release Date: | July 2011 |
| Feature: | Working Papers |
The tax policy toward multinational firms has come under increased scrutiny with the rise of global activities of firms and concerns that these activities displace activities at home. This scrutiny has raised the question of whether current tax policy inefficiently subsidizes the foreign activities of firms. Mihir A. Desai, C. Fritz Foley, and James R. Hines, Jr. consider this claim by applying the theory of dynamic efficiency to the activities of multinational firms. Specifically, by comparing direct investment abroad with repatriated investment returns over the last sixty years, they conclude that firms are not investing to dynamically inefficient levels, suggesting that current tax policy is not an inefficient subsidy.
Is it Time for a National Bankruptcy?
| Published: | June 2, 2011 |
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| Feature: | What Do YOU Think? |
| Forum: | closed | 47 Comments posted |
Summing Up Is a national bankruptcy a tragedy or a needed lesson in fiscal reform? Jim Heskett's readers ponder the implications of a country going insolvent.
Mandatory IFRS Adoption and Financial Statement Comparability
| Authors: | Francois Brochet, Alan Jagolinzer, and and Edward J. Riedl |
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| Published: | May 19, 2011 |
| Paper Release Date: | April 2011 |
| Feature: | Working Papers |
In the past decade, many countries have adopted International Financial Reporting Standards (IFRS) developed by the International Accounting Standards Board, which has impelled economists to examine the benefits of the standards. This paper discusses how IFRS adoption affects financial reporting comparability—that is, the properties of financial statements that allow users to identify similarities or differences between the economics of different reporting entities over any given period of time. Research was conducted by Francois Brochet and Edward J. Riedl of Harvard Business School, and Alan Jagolinzer of the University of Colorado at Boulder.
How 'Political Voice' Empowers the Powerless
| Published: | May 5, 2011 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 4 Comments posted |
Women in India often are targets of verbal abuse, discrimination, and violent crimes—crimes that are underreported. Fortunately, an increase in female political representation seems to be giving female crime victims a voice in the criminal justice system, according to new research by Harvard Business School professor Lakshmi Iyer and colleagues.
While Waiting for Japan's Recovery, Let's Enhance Supplier Competitiveness at Home
| Published: | April 28, 2011 |
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| Feature: | Op-Ed |
| Forum: | open for comment; 3 Comments posted |
The Obama administration and US companies do not have to wait for Japanese suppliers to recover from earthquake damage, argues Harvard Business School professor Rosabeth Moss Kanter. Action can be taken now to ensure that America invests in growing our domestic stock of world-class suppliers.
