We study the relation between trade credit, asset prices, and production-network linkages. Empirically, firms extending more trade credit earn 7.6% p.a. lower risk premiums and maintain longer relationships with customers.
Standard private labels (PLs) have been the topic of multiple prior reviews. Having been leapfrogged by business practice, the marketing literature has only recently witnessed a surge in interest in multi-tier PL offerings. These typically include a budget and/or premium tier in addition to the omnipresent standard PL tier. This study offers a systematic review of recent empirical findings on budget and premium PLs.
This study examines the information content of risk factor disclosures following private debt issuance. Loan issuance is an information-intensive activity that significantly increases private information production through borrower-lender interactions.
This study builds on the knowledge spillover theory of entrepreneurship to examine the factors that influence the decision of latent entrepreneurs to move from opportunity recognition to opportunity exploitation and emergent entrepreneurship.
We study a multi-armed bandit problem with dependent arms. The decision maker dynamically chooses an arm out of finitely many arms to maximize her total expected discounted net benefit over an infinite time horizon. Pulling each arm incurs a particular cost and provides a certain reward. Arms' rewards are dependent on each other through a common parameter unknown to the decision maker. Thus, by pulling one arm, the decision maker also collects information about the other arms.
We examine the validity of the underlying assumption that the tax system favors superstar firms, using both forward-looking and backward-looking measures of firms’ tax burdens. Across multiple specifications, we find little empirical support for the idea that superstar firms are tax advantaged.
Firms' payout decisions respond to expected returns: everything else equal, firms invest less and pay out more when their cost of capital increases. Given investors' demand for firm payout, market clearing implies that the dynamics of productivity and payout demand fully determine equilibrium asset prices and returns. We use this logic to propose a payout-based asset pricing framework and we illustrate the analogy between our approach and consumption-based asset pricing in a simple two-period model. Then, we introduce a quantitative payout-based asset pricing model and calibrate the productivity and payout demand processes to match aggregate U.S. corporate output and payout empirical moments. We find that model-implied payout yields and firm returns go a long way in reproducing key attributes of their empirical counterparts.
Kenan-Flagler Business School professor and UNC Tax Center Research Director Jeff Hoopes comments on the intricacies of interpreting the president’s tax records if the push to release them ever comes to shove. Hoopes was quoted in this NPR article, which has been posted by more than 50 media outlets so far.
Román Orús, Ikerbasque Research Professor at the Donostia International Physics Center in San Sebastián, Spain, will present the findings from his research on determining the optimal trading trajectory for an investment portfolio of assets over a period of time. Dynamic portfolio optimization is well known to be NP-Hard and is central to quantitative finance.
As venture capital markets have surged in recent years, early access to capital remains highly localized. We examine changes that can help investors connect with underrepresented entrepreneurs outside traditional funding hubs, from innovative organizations to improvements in transportation.
Over the past decade, a number of empirical studies and analytical models have contributed to our understanding of brand and innovation management. Although branding and innovation are both popular and fruitful areas of academic research, we suggest a more expansive discussion to consider the interrelationship between the two in greater detail.
While commerce between firms, i.e., business or B2B markets is roughly comparable in monetary terms to the commerce between firms and consumers (B2C), the volume of high-quality academic research devoted to issues in B2B pales in comparison to that focused on B2C.1 Our goal with this special issue is a focus on important new research in this understudied domain.
We document differences in human capital deployment between diversified and focused firms. We find that diversified firms have higher labor productivity and that they redeploy labor to industries with better prospects in response to changing opportunities. The opportunities and incentives provided in internal labor markets in turn affect the development of workers' human capital. We find that workers more frequently transition to other industries in which their diversified firms operate and with smaller wage losses than workers in the open market, even when they leave their original firms. Overall, internal labor markets provide a bright side to corporate diversification.
The Frank H. Kenan Institute of Private Enterprise hosted its inaugural North Carolina Investment Forum (NCIF) November 1, 2017, at the Kenan Center on the campus of the University of...
On April 1-2, 2016, the Energy Center at the Kenan-Flagler Business School, University of North Carolina at Chapel Hill convened a conference on “Global Frac’ing, What has to Change for it to be a Game Changer?” It was an invitation only event with attendance limited to industry experts, leading consultants and responsible government officials. Attendees and speakers came from the U.S., UK, Poland, Mexico and Canada. This report summarizes the main points which emerged from the speaker presentations and subsequent discussion. It does not attempt to be a comprehensive treatment of Global Frac’ing. Rather, it raises four sets of questions and presents the conclusions which developed. The Executive Summary provides an overview of these conclusions. The appendices share details on two matters much discussed – what would be a model regulatory regime for unconventional development, and what would constitute a model fiscal regime?
This paper seeks to improve our understanding of how intermediaries operate to advance the commercialization of science by providing a set of specialized services. We review five intermediaries commonly mentioned in the ecosystem literature: university technology transfer and licensing offices; physical space (incubators, accelerators, and co-working spaces); professional services providers; networking, connecting, and assisting organizations; and finance providers (including venture capital, angel investors, public financing, and crowdfunding).
Philanthropy by entrepreneurs remains an empirically underexplored topic. Combining datasets on U.S. based IPOs with individual philanthropic gifts, we empirically demonstrate that entrepreneurial harvests indeed trigger entrepreneurs’ philanthropic behavior. Furthermore, we distinguish how entrepreneurs’ approach to philanthropy differs from other individuals who experience the same wealth creating event. Entrepreneurs are able to transition more quickly to philanthropy compared to non-entrepreneurs, are more likely to invest in university science and technology, and also provide a greater number of gifts.
Often the story of successful places is predicated on the story of an individual who was instrumental in creating institutions and making connections that were transformative for a local economy. Certainly this is the case for Silicon Valley in California and Fred Terman, the Dean of Engineering at Stanford University, USA, who offered his garage to his students, Hewlett and Packard, and encouraged other start-ups. Or George Kozmetsky, the founder of Teledyne, who created the Institute for Innovation, Creativity and Capital (IC2) and mentored over 260 local computer companies in Austin, Texas. Any reading of the lives of these individuals highlights their connection to community and motivations beyond making profits.
Tomoki Tanaka, vice president of Mitsubishi UFJ Financial Group and MUFG Bank, will join Rethinc. Labs for the next event in their Quantum webinar series. Working with researchers from the financial team at the IBM Q Network Hub at Keio University, Tanaka found several quantum algorithms that may be implementable in near-term devices for estimating the amplitude of a given quantum state. This is a core subroutine in various computing tasks, such as the Monte Carlo method.
A growing body of rigorous academic literature empirically demonstrates that high-skilled immigrants provide a range of long-lasting and material benefits to the U.S. economy through entrepreneurship and innovation. Recent research has quantified the impact of foreign-born founders on key economic indicators such as firm creation, job creation and overall business innovation. Likewise, a growing body of literature documents how skilled immigrants have more broadly facilitated technological innovation.