Publications
Annual Review of Financial Economics
| Editors: | Andrew W. Lo and Robert C. Merton |
|---|---|
| Publication: | Vol. 1. Palo Alto: Annual Reviews, 2009 |
An abstract is unavailable at this time.
Publisher's Book Abstract: http://www.annualreviews.org/catalog/2009/fe01.aspx
Kidneys for Sale: Who Disapproves, and Why?
| Authors: | Stephen Leider and Alvin E. Roth |
|---|---|
| Publication: | Journal of Transplantation 10 (May 2010): 1221-1227 |
Abstract
The shortage of transplant kidneys has spurred debate about legalizing monetary payments to donors to increase the number of available kidneys. However, buying and selling organs faces widespread disapproval. We survey a representative sample of Americans to assess disapproval for several forms of kidney markets and to understand why individuals disapprove by identifying factors that predict disapproval, including disapproval of markets for other body parts, dislike of increased scope for markets, and distrust of markets generally. Our results suggest that while the public is potentially receptive to compensating kidney donors, among those who oppose it, general disapproval towards certain kinds of transactions is at least as important as concern about specific policy details. Between 51% and 63% of respondents approve of the various potential kidney markets we investigate, between 42% and 58% want such markets to be legal, and 38% of respondents disapprove of at least one market. Respondents who distrust markets generally are not more disapproving of kidney markets; however we find significant correlations between kidney market disapproval and attitudes reflecting disapproval towards certain transactions—including both other body markets and market encroachment into traditionally non-market exchanges, such as food preparation.
Working Papers
A Reexamination of Tunneling and Business Groups: New Data and New Methods
| Authors: | Jordan I. Siegel and Prithwiraj Choudhury |
|---|
Abstract
The last decade of corporate governance research has been focused in large part on identifying what leads to superior or deficient corporate governance in emerging economies. We propose that firms' corporate governance and firms' strategic business activities within an industry are interlinked. By conducting a simultaneous economic analysis of business strategy and corporate governance, scholars can better discern the quality of a firm's governance. We look at one of the most rigorous extant methodologies for detecting "tunneling," or efforts by firms' controlling owner managers to take money for themselves at the expense of minority shareholders. We find that, in contrast to prior views, Indian business groups are not, on average, engaging in tunneling (expropriation) but are, on average, exhibiting good corporate governance, especially in light of the markedly different business strategies they typically undertake. Moreover, unlike many past conceptions of business groups from financial economics, sociology, and strategy, we find evidence for a knowledge-based "recombinative capabilities" view of business groups—that such groups have done the most to invest in R&D and other skills necessary to combine inputs in ways that lead to greater added value. Further, our finding that Indian business groups have grown larger and more diversified since liberalization and since broad-based corporate governance reforms were implemented goes expressly against the prediction of prior schools of thought about business groups. We argue that the conventional wisdom about tunneling and business groups will need to be questioned and reformulated in light of the new data, methodology, and findings presented in this study.
Download the paper: http://www.hbs.edu/research/pdf/10-072.pdf
Cases & Course Materials
Real Blue? Viagra and Intellectual Property Rights Law in China
Regina Abrami and Tracy Yuen Manty
Harvard Business School Case 910-409
On July 5, 2004, Pfizer's China team received disappointing news. China's patent review board just invalidated the company's existing patent on one of its most successful drugs, Viagra. Making matters worse, a Guangdong-based pharmaceutical company laid claim to Viagra's street name "Wei Ge" (Great Brother), arguing that the term was not a well-known trademark in China. With two lawsuits related to intellectual property rights now pending in China, Pfizer wondered whether trade politics or the rule of law would prevail.
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CommonAngelTM (A)
Lynda M. Applegate, Kaitlyn Simpson, Max White, and Christopher McDonald
Harvard Business School Case 810-082
Describes the motivations behind the founding of CommonAngels—a group of successful business owners who provide capital, connections, and expertise to entrepreneurs who are building new ventures. In 2005, the group is considering increasing its investment focus to include a broader range of technologies, including emerging technologies (for example, Mobile and RFID technologies) and non-information technologies.
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CommonAngelTM (B)
Lynda M. Applegate, Kaitlyn Simpson, Max White, and Christopher McDonald
Harvard Business School Supplement 810-011
This case discusses changes in CommonAngels' investment model and organization between 2005 and 2009.
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Miracle Life Inc.
Lauren H. Cohen and Christopher Malloy
Harvard Business School Case 210-039
Miracle Life is a firm with a unique setup and organizational structure. Specifically, it is a network marketing firm, also known as multi-level marketing (MLM) firm, which utilizes a large distributor base and depends on this individual distributor base to sell its products, giving explicit incentives for these individual distributors to both sell its products and sign up other distributors. The case gives students the opportunity to take the basic framework of Discounted Cash Flow (DCF) Analysis and apply it to two unique perspectives of an identical problem. The students will then use this DCF approach to rationalize observed stock prices, connecting the two, and further reconcile how a company's future plan for growth, and the plausibility of this plan, has implications jointly for DCF and stock prices.
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United Breaks Guitars
John Deighton and Leora Kornfeld
Harvard Business School Case 510-057
When social media propagate a complaint about poor customer service, an international media event ensues. How do viral videos spread and what can firms do about them? This case dissects an incident in which a disgruntled customer used YouTube and Twitter to spread a music video detailing United's mishandling of his $3,500 guitar and the company's subsequent refusal to compensate him. The song was called "United Breaks Guitars." Within one week it received 3 million views and mainstream news coverage followed, with CNN, The Wall Street Journal, BBC, the CBS Morning Show, and many other print and electronic outlets picking up on the story. The mechanics of viral propagation are uncovered, and the limited opportunities for response by the firm are revealed. The case supports the notion of the Internet as an insurgent medium, better at attack than at defense.
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Lyondell Chemical Company
Stuart C. Gilson and Sarah L. Abbott
Harvard Business School Case 210-001
Hit with an industry recession and the global financial crisis of 2008, in January 2009 LyondellBasell Industries AF S.C.A., one of the world's largest internationally diversified chemical companies headquartered in The Netherlands, placed its U.S. operations and a German subsidiary under U.S. Chapter 11 bankruptcy protection. To successfully reorganize as a going concern, the company sought to raise over $8 billion in a super-priority "Debtor-in-Possession (DIP)" loan from a group of 13 financial institutions, including commercial banks, investment banks, hedge funds, and private equity funds. Representing one of the largest DIP loans in history, this financing was considered critical to the company's survival. One unique and controversial feature of the financing was a $3.25 billion "roll-up" facility, under which a number of Lyondell's pre-bankruptcy lenders were allowed to significantly elevate the priority of debts they were already owed (so that they ranked ahead of all other pre-bankruptcy debts owed by the company), provided the lenders advanced new loans to the company to help finance its restructuring. With a costly liquidation as the alternative, various creditor groups objected to the DIP financing package, putting Lyondell's reorganization, and survival as a going concern, at significant risk.
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Proteus Biomedical: Making Pigs Fly
Richard G. Hamermesh, Lauren Barley, and Ginger L. Graham
Harvard Business School Case 809-051
Proteus is a healthcare start-up that has developed technology to embed electronics for computing and sensing in existing medical devices and drugs. The technology could potentially change the basis of competition in the pharmaceutical industry. The company is currently considering a number of licensing and business development deals and must choose which one(s) to pursue.
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American Well: The Doctor Will E-See You Now
Elie Ofek and Ron Laufer
Harvard Business School Case 510-061
What is next for healthcare IT provider American Well, whose innovative Online Care technology allows physicians to deliver care to patients online in real time? Using American Well's platform, patients with non-emergency health concerns can communicate with physicians online or by phone and receive advice or even a diagnosis without having to visit the physician's office. American Well's co-founders, Ido Schoenberg and Roy Schoenberg, believe this platform will reduce the cost of care delivery; create new revenue-earning opportunities for providers; and contribute to a more efficient, convenient healthcare delivery system. While the platform could benefit insurers, providers, employers, and patients alike, the company has only marketed to a few health insurance companies to date. In November 2009, 3 insurers have adopted the technology, and American Well expects several more to do so over the next 12 months. As the company plans to accelerate adoption by health insurers, it is also considering other growth options. Is it too early to commit resources to developing and marketing American Well's second-generation product, which facilitates real-time connectivity between primary care physicians and specialists? Should American Well pursue new markets in the U.S., such as hospitals, chains of clinics, and pharmacies, or even expand internationally? In a broader sense, American Well's technology solves the economic obstacle of time and place by connecting excess supply (of physician capacity) with excess demand (for patient care). Could this model be adapted to other industries, such as legal and accounting services? Alternatively, should American Well continue to focus solely on its primary product and on becoming the leader in the Online Care Industry?
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Sheila Mason & Craig Shepherd (Abridged)
Michael J. Roberts
Harvard Business School Case 810-114
The case describes two individuals who have met and are in the process of starting a company together. Each is still at his/her former employer, and each has signed a different employment agreement that, on paper, may prohibit some of the contemplated acts—i.e., soliciting customers or employees. The case focuses on how individuals should think about leaving their employers in general and how these specific legal agreements may impact the situation in this case. In addition, the case includes issues around dealing with venture capitalists, non-disclosure agreements, as well as how to select and work with a lawyer.
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Tennant Company
Toby Stuart, Lynda M. Applegate, and James Weber
Harvard Business School Case 810-040
Tennant, a leading producer of floor cleaning equipment, must determine how to create, finance, structure, staff, govern, measure, and manage a new venture for developing a fundamentally new product line. In 2005, Tennant Company had developed an innovative, environmentally friendly cleaning technology that could potentially revolutionize cleaning. Historically, Tennant was a producer of floor and carpet washing machines for industrial and commercial markets. Over time, it became clear that the technology had applications far beyond Tennant's core markets. In mid-2009, the company set up a new venture to develop the technology's promise. In 2010 this venture was wholly owned by Tennant and run by a Tennant manager. The case examines the decisions the CEO and new venture head must make to best structure and position the venture to succeed.
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