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The World Management Survey at 18: Lessons and the Way Forward

by Daniela Scur, Raffaella Sadun, John Van Reenen, Renata Lemos, and Nicholas Bloom

With a dataset of 13,000 firms and 4,000 schools and hospitals spanning more than 35 countries, the World Management Survey provides a systematic measure of management practices used in organizations. This paper gives an overview of lessons learned and a management policy toolkit for policymakers.

Currency Hedging in Emerging Markets: Managing Cash Flow Exposure

by Laura Alfaro, Mauricio Calani, and Liliana Varela

Economies with less liquid foreign exchange derivative markets offer firms fewer options to hedge their currency risk. Given the limitations of natural hedging, these firms are more exposed to systemic risk.

Kidney Exchange: An Operations Perspective

by Itai Ashlagi and Alvin E. Roth

Kidney exchange has become a standard form of transplantation in the United States and a few other countries in part because of exchange process improvements. However, much more needs to be done: There are still many more patients in need of transplants than can be saved.

Whose Job Is It Anyway? Co-Ethnic Hiring in New US Ventures

by Sari Pekkala Kerr and William R. Kerr

The impact of immigration has been particularly sharp in entrepreneurship, yet there is remarkably little evidence about how immigration in the workplace connects to the creation and scaling of new firms. The economic consequences of greater workplace and entrepreneurial diversity deserve closer attention.

Assessing the Strength of Network Effects in Social Network Platforms

by Marco Iansiti

Network-specific traits, such as the degree of clustering and the prevalence of multihoming, influence the strength and competitive impact of network effects. However, network size alone is often misleading, and network effects should be examined on a case-by-case basis.

Consuming Contests: Outcome Uncertainty and Spectator Demand for Contest-based Entertainment

by Patrick J. Ferguson and Karim R. Lakhani

Analysis of Australian Football League data shows that the uncertainty of game outcomes has a large, positive causal effect on stadium attendance. These findings show how competitive balance is important for contest designers in general and sports leagues in particular.

Fairness or Control: What Determines Elected Local Leaders’ Support for Hosting Refugees in Their Community?

by Kristin Fabbe, Eleni Kyrkopoulou, Konstantinos Matakos, and Asli Unan

Local politicians are not adamantly opposed to setting up host sites for refugees in their municipalities. However, they want a fair process to ensure that interaction between refugees and residents is limited, gradual, and mediated. Most importantly, local politicians want to control those interactions.

The Health Costs of Cost-Sharing

by Amitabh Chandra, Evan Flack, and Ziad Obermeyer

Small increases in cost cause patients to reduce their use of drugs with major benefits, ultimately causing their death. Since patient cost-sharing introduces large and deadly distortions into the cost-benefit calculus, payers should evaluate the merits of policies in light of their impact on health, not just on health care costs.

Real Credit Cycles

by Pedro Bordalo, Nicola Gennaioli, Andrei Shleifer, and Stephen J. Terry

The financial crisis of 2008 renewed economists’ interest in financial fragility, specifically understanding its origins. This paper shows how market participants’ expectations can be part of standard macroeconomic models and significantly improve their explanatory power.

Stock Price Reactions to ESG News: The Role of ESG Ratings and Disagreement

by George Serafeim and Aaron Yoon

Company performance evaluations have included sell-side analyst forecasts, recommendations, and credit ratings, but a newer set has emerged: environmental, social, and governance (ESG) ratings. This study finds that ESG ratings are useful for predicting future ESG news, but their predictive ability diminishes for firms with large disagreement between raters.

Connecting Expected Stock Returns to Accounting Valuation Multiples: A Primer

by Akash Chattopadhyay, Matthew R. Lyle, and Charles C.Y. Wang

This paper introduces a framework to investors and researchers interested in accounting-based valuation. The framework connects expected stock returns to accounting valuation anchors. It can be generalized to evaluate an enterprise's expected returns, and can be adapted to correct for the use of stale accounting data.

Measuring Employment Impact: Applications and Cases

by Katie Panella and George Serafeim

Employment impact-weighted accounting statements quantify the positive and negative effects of firm practices for employees and the broader labor community. This analysis of companies in different sectors shows how these statements are beneficial both at an aggregate and more specific level.

Private and Social Returns to R&D: Drug Development and Demographics

by Efraim Benmelech, Janice Eberly, Dimitris Papanikolaou, and Joshua Krieger

Research and development (R&D) by pharmaceutical firms focuses disproportionately on medical conditions afflicting the elderly. The proportion of R&D spending targeting older age groups is increasing over time. Even though these investments in R&D prolong life expectancy and improve quality of life, they have little effect on measured productivity and output growth.

Auditor Independence and Outsourcing: Aligning Incentives to Mitigate Shilling and Shirking

by Ashley Palmarozzo, Jodi L. Short, and Michael W. Toffel

Firms use external auditors to monitor the quality of difficult-to-observe aspects of their business partners’ performance, including the working conditions of their suppliers. Firms can improve monitoring accuracy by having their own employees conduct some audits, and by rotating across third-party auditing firms.

Information Avoidance and Image Concerns

by Christine L. Exley and Judd B. Kessler

People avoid information that might compel them to behave more generously. While many people avoid information due to concerns about their self-image, there is a substantial role for other reasons, such as inattention and confusion.

Bollywood, Skin Color, and Sexism: The Role of the Film Industry in Emboldening and Contesting Stereotypes in India after Independence

by Sudev Sheth, Geoffrey Jones, and Morgan Spencer

Analysis of interviews with Bollywood producers and actors shows the extent of biases in the film industry during the decades after India’s independence in 1947. Gender stereotyping has remained a noteworthy feature of films, and bias towards light skin has only intensified.

In the Red: Overdrafts, Payday Lending, and the Underbanked

by Marco Di Maggio, Angela Ma, and Emily Williams

Low-income customers turn to payday lenders and check cashers for basic financial needs when traditional banks push them out of the system through high overdraft fees and other penalties. Reducing overdraft fees improves consumers’ overall financial health and access to cheaper credit.

Nonprofits in Good Times and Bad Times

by Christine L. Exley, Nils H. Lehr, and Stephen J. Terry

Tax returns from millions of US nonprofits reveal that charities do not expand during bad times, when need is the greatest. Although they are able to smooth the swings of their activities more than for-profit organizations, nonprofits exhibit substantial sensitivity to economic cycles.

Learning with People Like Me: The Role of Age-Similar Peers on Online Business Course Engagement

by Laura R. Huber, Jacqueline N. Lane, and Karim R. Lakhani

Online learning usually has lower course engagement and higher dropout rates than in-person instruction. However, when classmates are of similar ages it helps boost retention and engagement. Similar-aged classmates have more in common, making interactions mutually rewarding.

Hate Crime Increases with Minoritized Group Rank

by Mina Cikara, Vasiliki Fouka, and Marco Tabellini

Attitudes and behaviors toward social categories are not fixed but vary depending on perceived group size and rank. In the United States, an increase in a group’s size-based rank relative to those of other minority groups is associated with greater likelihood of being targeted with hate crimes.