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New research on governance from Harvard Business School faculty on issues including governance policy, Boards and other governing institutions and the influence of shareholders and government regulators.
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Leadership Advice for Biden: Restore a Sense of Calm

by Dina Gerdeman

Harvard Business School faculty members share their expectations for a Biden presidency and offer advice to the commander in chief as he takes on the raging COVID-19 pandemic and a divided nation. Open for comment; Comment(s) posted.

Dog Eat Dog: Measuring Network Effects Using a Digital Platform Merger

by Chiara Farronato, Jessica Fong, and Andrey Fradkin

With heated debate over antitrust regulation of online platforms, this study finds that when a larger platform acquired its greatest competitor, users were not better off with a single platform compared with two competitors, despite marked efficiency improvements experienced by the acquiring platform.

Nonprofit Boards: It is Time to Lift Your Gaze and See the System

by Shamal Dass, Kristy Muir, and V. Kasturi Rangan

Not every organization should attempt to solve problems at a system level, but can become more aware of systemic issues, ensuring that solutions dovetail into the macrosystem for best collective impact.

What Does December's Drug-Approval Dash Mean for COVID-19 Vaccines?

by Danielle Kost

Even in the best of times, pharmaceutical regulators tend to rush through drug applications in December. Now add in a ruthless pandemic. Research and insights from Lauren Cohen. Open for comment; Comment(s) posted.

Short-Termism, Shareholder Payouts, and Investment in the EU

by Jesse M. Fried and Charles C.Y. Wang

Shareholder-driven “short-termism,” as evidenced by increasing payouts to shareholders, is said to impede long-term investment in EU public firms. But a deep dive into the data reveals a different story.

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.

Capitalism Works Better When I Can See What You're Doing

by Sean Silverthorne

Lower prices. More innovation. Better government. Transparency fuels the basic principles of competitive business and open government. Well, most of the time. Open for comment; Comment(s) posted.

Of Learning and Forgetting: Centrism, Populism, and the Legitimacy Crisis of Globalization

by Rawi Abdelal

Cycles of liberation and regulation of global finance follow a pattern of learning and forgetting. This essay argues that liberalization and globalization created the instability and inequality that have begun to undermine the system from within.

Why Investors Often Lose When They Sue Their Financial Adviser

by Danielle Kost

Forty percent of American investors rely on financial advisers, but the COVID-19 market rollercoaster may have highlighted a weakness when disputes arise. The system favors the financial industry, says Mark Egan. Open for comment; Comment(s) posted.

How Countries Use Financial Policy to Fight COVID-19

by Rachel Layne

Developing countries have fewer fiscal tools and policy options to combat COVID-19 damage to their economies, according to research by Alberto Cavallo and colleagues. Open for comment; Comment(s) posted.

It's Time for a Bipartisan Health Plan for Employers and Employees

by Regina E. Herzlinger and Richard J. Boxer

Regina E. Herzlinger and Richard J. Boxer prescribe a seemingly impossible cure for battling health care options: a plan that embraces both Republican and Democratic ideas. Open for comment; Comment(s) posted.

Sticky Capital Controls

by Miguel Acosta-Henao, Laura Alfaro, and Andrés Fernández

One of the legacies of the 2007–2008 global financial crisis has been a reassessment of the potential for restriction of capital flows policies. This paper documents a set of stylized facts on capital controls along their intensive and extensive margins for emerging markets and document them to be “sticky.” We then rationalize them through a model that includes fixed cost of implementing such policies, which lower the welfare gains of implementation.

Making Economics More Useful: How Technological Eclecticism Could Help

by Amar Bhidé

This paper shows how tools, such as simulations used to design new technologies, can facilitate collaborative economic policy judgments. The paper forms part of a broader, ongoing study of knowledge in practical fields such as engineering, medicine, and business.

How Should US Bank Regulators Respond to the COVID-19 Crisis?

by Michael Blank, Samuel G. Hanson, Jeremy C. Stein, and Adi Sunderam

Instead of the "watchful waiting" approach taken by US bank regulators to the pandemic crisis, they should use their prudential authorities to encourage banks to increase their equity capital. This is effectively a way of buying low-cost insurance against adverse scenarios that have become more likely.

Inflation with COVID Consumption Baskets

by Alberto Cavallo

Examining the impact that changes in expenditure patterns are having on the measurement of consumer price indices (CPI) inflation in 17 countries, this study finds that the cost of living for the average consumer is higher than estimated by the official CPI. This implies that real consumption is falling more quickly over time.

Social Interactions in Pandemics: Fear, Altruism, and Reciprocity

by Laura Alfaro, Ester Faia, Nora Lamersdorf, and Farzad Saidi

An analysis of 89 cities worldwide shows that mobility responds to infection risk, altruism, and reciprocity. Correcting the SIR model to account for this behavior shows that a balanced approach involving stringency measures, in respect of human dignity, and responsible social preferences mitigates the pandemic health and economic costs.

The Rise of the Investor State: State Capital in the Chinese Economy

by Hao Chen and Meg Rithmire

Researchers document and explain the rise of a novel form of intervention on the part of the Chinese state: the expansion of state capital beyond ownership of state firms.

Government Incentives for Entrepreneurship

by Josh Lerner

Even though many public policy efforts on entrepreneurship are well intentioned, the success rate has been disappointing. This essay explores these policies, focusing on financial incentives to entrepreneurs and the intermediaries who fund them.

HBS COVID-19 Global Policy Tracker

by Alberto Cavallo and Tannya Cai

The Harvard Business School Covid-19 Global Policy Tracker monitors new developments and changes in government policies throughout this crisis to analyze trends and correlations in countries' responses and economic impact.

Rebates in the Pharmaceutical Industry: Evidence from Medicines Sold in Retail Pharmacies in the U.S.

by Pragya Kakani, Michael Chernew, and Amitabh Chandra

Retail pharmacy data illustrates it can be misleading to use list prices instead of net prices to understand pharmaceutical prices. Analysts and economists working in public policy should be extremely cautious in drawing policy conclusions based on list prices alone.