The COVID-19 pandemic has put 18 million jobs at small businesses in the U.S. at risk – which could as much as quadruple the nation’s total unemployment rate. The effects of both the coronavirus and recent government relief programs were explored by a panel of Kenan Institute-convened experts during a press briefing held yesterday. The full recording of this briefing—along with a deeper-dive analysis on the specific implications of the financial downturn on small business employment by Kenan Institute Research Director Professor Christian Lundblad and UNC Kenan-Flagler Business School Professor Paige Ouimet—is available in this week’s Kenan Insight.
What is the impact of higher technological volatility on asset prices and macroeconomic aggregates? I find the answer hinges on its sectoral origin. Volatility that originates from the consumption (investment) sector drops (raises) macroeconomic growth rates and stock prices.
With every passing generation, a family-run business faces the risk of losing steam due to improper handovers and inadequate talent and leadership development. How, then, can the senior-generation of leaders ensure that all the years of blood and sweat that went into building a business don't go to waste? The third and final installment of our family business series attempts to answer this question.
Times are tough for universities. Leaders on campus are facing more pressure than ever – strategic, operational, and financial. How do we manage our administrative functions efficiently to free up resources for our core dual mission of teaching and research?
Business incubators are taking on a greater role in the development of entrepreneurial ecosystems, but debate continues over whether, how and in what situations they work. In this Kenan Insight, we explore what makes incubators successful and how communities can determine if one is right for them.
Scholars continue to debate whether voice and silence are opposites or distinct constructs. This ambiguity has prevented meaningful theoretical advancements about employees’ voice and silence at work. We draw on the behavioral activation and behavioral inhibition systems perspective to provide a conceptual framework for the independence of voice and silence and explicate how two key antecedents—perceived impact and psychological safety—more strongly relate to voice and silence, respectively. We further differentiate voice and silence by identifying their unique effects on employee burnout.
We reassess whether and to what degree the hiring, development, and promotion decisions of S&P 500 companies has led to misrepresentation of and bias against their minority executives. Instead of the US population benchmark that has conventionally been used to measure misrepresentation, and from such misrepresentation attribute the presence and magnitude of racial bias and discrimination, we measure misrepresentation in US executives using the benchmark of the racial/ethnic densities (RAEDs) of their college cohort peers. Our key result is that the differences between US executive RAEDs and the RAEDs of their college peers are far smaller than those found using the US population, typically by an order of magnitude or more.
Corporate restructurings accomplished through spinoffs have long been a key tool for management to unlock shareholder value. In 2016, global spinoff volume reached $117 billion, and spinoff activity continues to unfold at a similar pace in 2017, with Hilton, Xerox, Alcoa, Johnson Controls, and Danaher all recently completing major transactions.
Accounting rules, through their interactions with capital regulations, affect financial institutions’ trading behavior. The insurance industry provides a laboratory to explore these interactions: life insurers have greater flexibility than property and casualty insurers to hold speculative-grade assets at historical cost, and the degree to which life insurers recognize market values differs across U.S. states. During the financial crisis, insurers facing a lesser degree of market value recognition are less likely to sell downgraded asset-backed securities. To improve their capital positions, these insurers disproportionately resort to gains trading, selectively selling otherwise unrelated bonds with high unrealized gains, transmitting shocks across markets.
This special issue is intended to present the state-of-the-art research progress on related subjects and to foster additional research in this important emerging area in production and operations management.
We provide an innovative methodological contribution to the measurement of returns on infrequently traded assets using a novel approach to repeat-sales regression estimation. The model for price indices we propose allows for correlation with other markets, typically with higher liquidity and high frequency trading. Using the new econometric approach, we propose a monthly art market index, as well as sub-indices for impressionist, modern, post-war, and contemporary paintings based on repeated sales at a monthly frequency. The correlations enable us to update the art index via observed transactions in other markets that have a link with the art market.
We study multi-period sales-force incentive contracting where salespeople can engage in effort gaming, a phenomenon that has extensive empirical support. Focusing on a repeated moral hazard scenario with two independent periods and a risk-neutral agent with limited liability, we conduct a theoretical investigation to understand which effort profiles the firm can expect under the optimal contract. We show that various effort profiles that may give the appearance of being sub-optimal, such as postponing effort exertion (“hockey stick”) and not exerting effort after a bad or a good initial demand outcome (“giving up” and “resting on laurels,” respectively) may indeed be induced optimally by the firm.
Hasbrouck (2018) takes advantage of the fact that U.S. equity market data are timestamped to nanosecond precision, and explores models of price dynamics at resolutions sufficient to capture the reactions of the fastest agents. The paper therefore addresses the econometric analysis of multivariate time series models at sub-millisecond frequencies and relies on long distributed lag models to alleviate the computational complexity while still taking advantage of the inherent sparsity of price transitions.
Hospital emergency departments (EDs) provide around-the-clock medical care and as such are generally modeled as nonterminating queues. However, from the care provider’s point of view, ED care is not a never-ending process, but rather occurs in discrete work shifts and may require passing unfinished work to the next care provider at the end of the shift.
As federal, state and local governments struggle to reopen the economy as the COVID-19 pandemic surges onward, efforts to ensure people’s health and safety are seemingly at odds with attempts to spur economic activity. In this Kenan Insight, we explore how a data-driven approach to reopening North Carolina (and the U.S. as a whole) can help preserve both lives and livelihoods.
When an innovator sources for an innovative product from a supplier who is also a competitor in the end market, the potential innovation spillover may be a serious concern. Will an innovation ever source from a competitor-supplier in the presence of innovation spillover? In this paper we attempt to answer this question with an emphasis on the ex-ante uncertain values of innovations, and distinguish between technical innovations which can only spill over through sourcing and non-technical innovations which can spill over through sourcing as well as in the market.
How do cities attract mobile firms? The answer, frequently, involves beer. Dr. Maryann Feldman has recently published an editorial describing how cities are increasingly selling themselves on quality of life metrics, talent, and trendy amenities that appeal to young professionals. Responding to Amazon’s HQ2 contest, cities across the country listed breweries among their city’s assets while wooing the technology giant. The article is based on a paper that three of her students wrote under her guidance, and the inspirations for which evolved out of a seminar Dr. Feldman taught on science and technology policy.
Co-brands are strategically advantageous partnerships which can also involve risk. For example, Papa John’s gained access to the largest television audience in the US by sponsoring the National Football League (NFL), but later blamed stagnant sales on how the NFL’s handled players’ well-publicized protests of inequitable policing. What implications did Papa John’s prioritization of sales over fairness have for NFL consumption? To answer this question, the current research tests for changes in Sunday watch party rituals (SWPR), when U.S. consumers gather to socialize while watching live NFL games.
“When are you going to change this Children’s Safe Drinking Water program and make money for your company? Surely Procter & Gamble wants you to profit on the water purification technology—you can’t sustain your program as a non-profit!” Greg Allgood sighed internally at this question, as it seemed to surface frequently despite the continued and rapid growth of the Children’s Safe Drinking Water (CSDW) program at P&G. Allgood (Director of the CSDW program) was not actually frustrated with the query, as he had an easy answer ready. Rather, he wished that people could more easily see how his team’s non-profit work was adding greater value to the $80 billion dollar company than a for-profit sales model ever could. Procter & Gamble is a data-driven company, and after 24 years as a “Proctoid” he knew this better than anyone. Greg had significant qualitative and some quantitative information to support the idea that, in some cases, a non-profit business model could do much more for the bottom line than could a for-profit model. However, he knew that he needed to do even more to clarify this point for others.
The arrival of two approved COVID-19 vaccines provides a clear path to the end of the pandemic that held most of 2020 hostage. But a recent resurgence of the virus and skyrocketing rates of infection indicate that a full return to normalcy—including the pre-pandemic work environment— is still months in the future. In this Kenan Insight, we examine the relevant factors that will determine when and how we go back to the office.