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Accounting for Product Impact in the Consumer Finance Industry

by George Serafeim and Katie Trinh

A framework and method for measuring and monetizing product impact across industries, applying it to two competitors in the consumer finance space.

Venture Capitalists and COVID-19

by Paul A. Gompers, Will Gornall, Steven N. Kaplan, and Ilya A. Strebulaev

This survey of more than 1,000 venture capitalists finds that the VC industry and its portfolio companies have reduced their activity less than in previous recessions and have been more resilient than many other sectors of the global economy.

Private Equity and COVID-19

by Paul A. Gompers, Steven N. Kaplan, and Vladimir Mukharlyamov

Private equity investors are seeking new investments despite the pandemic. This study shows they are prioritizing revenue growth for value creation, giving larger equity stakes to management teams, and targeting somewhat lower returns.

Long-Run Returns to Impact Investing in Emerging Markets and Developing Economies

by Shawn Cole, Martin Melecky, Florian Mölders, and Tristan Reed

Examination of every equity investment made by the International Finance Corporation, one of the largest and longest-operating impact investors, shows this portfolio has outperformed the S&P 500 by 15 percent.

The European Commission’s Sustainable Corporate Governance Report: A Critique

by Mark Roe, Holger Spamann, Jesse Fried, and Charles Wang

The European Commission commissioned a report on sustainable corporate governance that purports to find serious problems of corporate short-termism. The report is wholly flawed: it conflates time horizon problems with externality problems, mismeasures investment and its financing, and proposes ineffective, possibly harmful reforms.

The Stock Market Value of Human Capital Creation

by Matthias Regier and Ethan Rouen

Measuring human capital creation is complex but increasingly important to managers for understanding the relationship between employee expenditures and firm performance. This paper develops a strategy to examine aspects of the intangible human capital investment embedded in a firm’s personnel expense. Closed for comment; Comment(s) posted.

An Executive Order Worth $100 Billion: The Impact of an Immigration Ban’s Announcement on Fortune 500 Firms’ Valuation

by Dany Bahar, Prithwiraj Choudhury, and Britta Glennon

President Trump’s executive order restricting entry of temporary foreign workers to the United States negatively affected the valuation of 471 publicly traded Fortune 500 firms by an estimated $100 billion. Closed for comment; Comment(s) posted.

Accounting for Organizational Employment Impact

by David Freiberg, Katie Panella, George Serafeim, and T. Robert Zochowski

Impact-weighted accounting methodology standardizes previously disparate measures of impact, in this case the impact of employment. This paper’s methodology and analysis of Intel, Apple, Costco, and Merck shows the feasibility of measuring firm employment impact for insight into firm practices and performance. Closed for comment; Comment(s) posted.

Does Venture Capital Attract Human Capital? Evidence from a Randomized Field Experiment

by Shai Bernstein, Kunal Mehta, and Richard Townsend

Using a randomized field experiment conducted on a large online search platform, this study illustrates how investments by top venture capital investors attract potential employees and improve the pool of candidates available for the startup.

Estimating Causal Effects in the Presence of Partial Interference Using Multivariate Bayesian Structural Time Series Models

by Fiammetta Menchetti and Iavor Bojinov

A case study of an Italian supermarket introducing a new pricing policy—in which it reduced prices on some brands—offers managers a new approach to reduce uncertainty. The approach is flexible and can be applied to different business problems.

Flight to Safety: How Economic Downturns Affect Talent Flows to Startups

by Shai Benjamin Bernstein, Richard Townsend, and Ting Xu

The COVID-19 crisis makes it more difficult for small, young firms to attract talent as higher-quality candidates turn to more mature firms. Such “flight to safety” leads to a deterioration in the quality of human capital available for startups.

Bankruptcy and the COVID-19 Crisis

by Jialan Wang, Jeyul Yang, Benjamin Iverson, and Ray Kluender

Analyzing the impact of the COVID-19 crisis on bankruptcy filing rates in the United States, this study finds that large businesses, small businesses, and consumers experience very different effects of the crisis.

Fencing Off Silicon Valley: Cross-Border Venture Capital and Technology Spillovers

by Ufuk Akcigit, Sina T. Ates, Josh Lerner, Richard Townsend, and Yulia Zhestkova

This study of foreign corporate investment transactions from 32 countries between 1976 and 2015 finds these investments pose a trade-off: While they support young firms in pursuing innovations they could not otherwise afford, they also generate knowledge for the foreign investors.

Where the Cloud Rests: The Economic Geography of Data Centers

by Shane Greenstein and Tommy Pan Fang

This study quantifies how data center managers make a trade-off between the setup and operational costs of running a facility and capturing local demand.

Optimal Illiquidity

by John Beshears, James J. Choi, Christopher Clayton, Christopher Harris, David Laibson, and Brigitte C. Madrian

This paper evaluates the optimality of retirement savings systems, finding that the best mix is a three-account system with a perfectly liquid savings account, a partially illiquid savings account (with an early-withdrawal penalty of approximately 10%), and a completely illiquid savings account.

Design and Analysis of Switchback Experiments

by Iavor I. Bojinov, David Simchi-Levi, and Jinglong Zhao

This paper presents a framework for managers to design and run switchback experiments.

Centrino and the Restructuring of Wi-Fi Supply

by Roberto Fontana and Shane Greenstein

This study examines Intel’s launch of Centrino and interprets it as a platform leader’s attempt to restructure a supply chain.

What Can Economics Say About Alzheimer's Disease?

by Amitabh Chandra, Courtney Coile, and Corina Mommaerts

This essay discusses the role of market frictions and "missing medicines" in drug innovation and highlights how frameworks and toolkits of economists can help our understanding of the determinants and effects of Alzheimer's disease on health.

Older People Are Less Pessimistic about the Health Risks of COVID-19

by Pedro Bordalo, Katherine B. Coffman, Nicola Gennaioli, and Andrei Shleifer

The pandemic presents a unique opportunity to investigate formation of beliefs about an unprecedented, widespread, and life-threatening event. One finding: COVID-19 makes the prospect of disease and death particularly salient for the young.

The Targeting and Impact of Paycheck Protection Program Loans to Small Businesses

by Alexander Bartik, Zoë B. Cullen, Edward L. Glaeser, Michael Luca, Christopher Stanton, and Adi Sunderam

Survey data on business owners collected by the Alignable network shows that lending to bank customers in better financial positions may have been prioritized, possibly crowding out less connected firms that would have benefitted more from the loans.