Associate Professor, University of California, Berkeley, Haas School of Business, and 2023 Kenan Institute Distinguished Fellow
We examine the relation between plant-level predictive analytics use and centralization of authority for more than 25,000 manufacturing plants using proprietary US Census data. We focus on headquarters authority over plants through delegation of decision-making and design of performance-based incentives.
As individuals seek success, destructive interpersonal clashes can emerge when they believe they can only succeed at the expense of others. Prior work suggests this zero-sum construal of success is more likely occur when people receive negative feedback regarding their achievement. In the present research, we identify another element in the workplace that can strengthen zero-sum beliefs, and not just for those who receive negative feedback, but even for those who receive positive feedback.
There is a growing interest in the industry around 3D printing. A related phenomenon is personal fabrication (PF) in which a firm sells products' design and lets the customers personalize and manufacture the product using 3D printing services. In this paper, we characterize the market and operational conditions that make PF an attractive operational strategy.
Despite encouraging signs, India’s retail market remains largely off-limits to large international retailers like Wal-Mart and Carrefour. Opposition to liberalizing FDI in this sector raises concerns about employment losses, unfair competition resulting in the large-scale exit of incumbent domestic retailers, and infant industry arguments to protect the organized domestic retail sector that is at a nascent stage. Based on international evidence, we suggest that allowing entry by large international retailers into the Indian market may help tackle inflation, especially in food prices.
We quantify the immediate net effect of the Tax Cuts and Jobs Act (TCJA) on the tax burden of corporate profits for public US corporations.
How do an organization's task requirements affect the ways in which it reacts to competitors’ strategic investments? This study uses a novel measure of task requirements (Case Mix Index), to test the competitive and spillover effects of prior adoption on a focal organization's timing of adoption, while accounting for the underlying demand-side drivers of adoption.
Customer reviews are essential to online marketplaces. However, reviews typically vary; ratings of a product or service are rarely the same. In many service marketplaces, including the ones for solar panel installations, supply-side participants are active. That is, a seller must make a proposal to serve each customer. In such marketplaces, it is not clear how (or if) the dispersion in customer reviews affects the seller activity level and number of matches in the marketplace. Our paper examines this by considering both ratings and text reviews.
Theories of crowdsourced search suggest that firms should limit the search space from which solutions to the problem may be drawn by constraining the problem definition. In turn, problems that are not or cannot be constrained should be tackled through other means of innovation. We propose that unconstrained problems can be crowdsourced, but firms need to govern the crowds differently.
We hypothesize that after a relaxation of short selling constraints, an escalation in short selling activity will heighten incentives for short sellers to accelerate price discovery by revealing their negative information. Consistent with this conjecture, we find that the overall sentiment of media coverage tilts significantly more negative for pilot relative to control firms following exogenous relief of short sale constraints.
Punishments are not always administered immediately after a crime is committed. Although scholars and researchers claim that third parties should normatively enact punishments proportionate to a given crime, we contend that third parties punish transgressors more severely when there is a time delay between a transgressor’s crime and when they face punishment for it. We theorize that this occurs because of a perception of unfairness, whereby third parties view the process that led to time delays as unfair.
Multicultural experiences – such as living, traveling, or working abroad – can have many psychological benefits, including decreasing intergroup bias. However, unlike the intergroup contact literature, research on multicultural experiences has yet to examine whether the valence of these experiences may moderate such outcomes. So, could multicultural experiences actually increase intergroup bias? Five studies reveal that multicultural experiences increase (rather than decrease) intergroup bias when those experiences are negative (rather than positive).
The paper uses structured machine learning regressions for nowcasting with panel data consisting of series sampled at different frequencies. Motivated by the problem of predicting corporate earnings for a large cross-section of firms with macroeconomic, financial, and news time series sampled at different frequencies, we focus on the sparse-group LASSO regularization which can take advantage of the mixed-frequency time series panel data structures.
The rapid growth in the adoption of mobile payments has already begun to reshape bank payment practices. Utilizing a unique data set from a leading bank in Asia that records credit card transactions of its customers before and after the launch of Alipay mobile payment, the largest mobile payment platform in the world, this study aims to understand the impact of mobile payment adoption on bank customer credit card activities and the change of this impact after the mobile payment expansion.
The 2022 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel was awarded to Ben S. Bernanke, Douglas W. Diamond, and Philip H. Dybvig “for research on banks and financial crises”. This article surveys the contributions of the three laureates and discusses how their insights have changed the way that academics and policymakers understand banks and their roles in financial crises.
Prior work on supervisor bottom-line mentality (SBLM) has suggested it represents a static, unbending focus, with supervisors so focused on the bottom line that they discount ethical considerations. We propose that SBLM varies, within-person, given various factors in a supervisor's work life that pull and push their attention to and away from the bottom line across their workweeks. We theorize that the varying nature of SBLM elicits anxiety in employees that is exhausting because, on the days supervisors give greater emphasis to the bottom line, employees must abandon the comfort of their routines to produce bottom-line results. Ultimately, this experience motivates employee unethical behavior (i.e., coworker undermining). We also predict that, by providing employees support and guidance, supervisors’ steadfast commitment to ethics (i.e., between-person ethical leadership perceptions) influences the degree to which exhausted employees undermine their coworkers.
Financial regulators and investors have expressed concerns about high pay inequality within firms. Using a proprietary data set of public and private firms, this paper shows that firms with higher pay inequality—relative wage differentials between top- and bottom-level jobs—are larger and have higher valuations and stronger operating performance. Moreover, firms with higher pay inequality exhibit larger equity returns and greater earnings surprises, suggesting that pay inequality is not fully priced by the market. Our results support the notion that differences in pay inequality across firms are a reflection of differences in managerial talent.
We show that in the years following a large broad-based employee stock option (BBSO) grant, employee turnover falls at the granting firm. We find evidence consistent with a causal relation by exploiting unexpected changes in the value of unvested options. A large fraction of the reduction in turnover appears to be temporary with turnover increasing in the third year following the year of the adoption of the BBSO plan. The increase three years post-grant is equal in magnitude to the cumulative decrease in turnover over the three prior years, suggesting that long-vesting BBSO plans delay, instead of prevent, turnover.
Young firms disproportionately employ and hire young workers. On average, young employees in young firms earn higher wages than young employees in older firms. Young employees disproportionately join young firms with greater innovation potential and that exhibit higher growth, conditional on survival. We argue that the skills, risk tolerance, and joint dynamics of young workers contribute to their disproportionate share of employment in young firms. Moreover, an increase in the supply of young workers is positively related to new firm creation in high-tech industries, supporting a causal link between the supply of young workers and new firm creation.