The Kenan Institute's Future of Fintech: Blockchain, Cryptocurrency and the Emerging Ecosystem symposium was featured in a WRAL TechWire story on Jan. 25. In partnership with Ripple, the event brought together business leaders, academic researchers and public sector financial regulators to discuss emerging trends, issues and opportunities in the financial technology sector.
Little is known about how TMT members affect a founder-led firm’s performance later in a firm’s life. Using novel methods and a sample of over 2,000 firms, we find that although team structure has a significant impact on the performance of non-founder-led firms (consistent with past literature), it has little to no effect on the operating performance of founder-led firms, suggesting that founder CEOs may exert too much control.
In this paper, we compare several approaches of producing multi-period-ahead forecasts within the GARCH and RV families – iterated, direct, and scaled short-horizon forecasts. We also consider the newer class of mixed data sampling (MIDAS) methods.
We examine the implications of less powerful forward guidance for optimal policy using a sticky-price model with an effective lower bound (ELB) on nominal interest rates as well as a discounted Euler equation and Phillips curve. We find that, under a wide range of plausible degrees of discounting, it is optimal for the central bank to compensate for the reduced effect of a future rate cut by keeping the policy rate at the ELB for longer.
Terrorist attacks. Oil spill disasters. Ebola outbreaks. Our world today is defined by what Jim Johnson, director of the Kenan Institute-affiliated Urban Investment Strategies Center, terms an atmosphere of “certain uncertainty.” Johnson spoke on what individuals need to survive this new reality at the Feb. 12 Carolina Conversations event at UNC-Chapel Hill.
Kenan Institute Executive Director Greg Brown, Director of Research Christian Lundblad and Senior Research Associate Philip Howard's research warns of the risks of investing in crowded hedge funds – particularly during periods of market distress. “The crowdedness of an equity position is an important ingredient for characterizing risk,” the trio wrote in their latest paper "Crowded Trades and Tail Risks."
High rates of opioid abuse have had a significant impact on the United States including implications for firms which must now contend with a lower pool of available and productive workers. This paper documents a negative effect of instrumented opioid prescriptions and subsequent individual employment outcomes.
In today’s world of interconnected and "always-on" information, companies that succeed are those that compete by leveraging the advantage of strategic control points. A strategic control point is a part of a market where, if controlled by one party, it can be used to leverage power elsewhere. This can occur throughout the supply chain, in a related business, or even in an unrelated market.
We directly test the reliability and relevance of investee fair values reported by listed private equity funds (LPEs). In our setting, disaggregated fair value measurements are observable for funds’ investees; and investee accounting fundamentals are also publicly disclosed. We find that LPE fair value measurements reflect equity book value and net income in a manner consistent with stock market pricing of listed companies.
We study the foreign externalities of the recent U.S. tax reform, commonly known as the Tax Cuts and Jobs Act (TCJA). Specifically, we examine foreign firms’ stock returns around key tax reform events. We find significant heterogeneity in market responses by country, industry, and firm.
This study analyzes whether fair value estimates of fund net asset values (NAVs) produced by private equity managers are accurate and unbiased predictors of future discounted cash flows (DCF). We exploit the fact that private equity funds have finite lives to compare reported NAVs to DCFs based on realized cash flows for 384 venture capital (VC) funds and 195 buyout funds spanning 1988-2016.
When multinational corporations face foreign marketing crises, the psychic distance between the home and host country represents a distinct challenge. This paper examines the curvilinear relationship between psychic distance and firm performance during marketing crises, and the moderating role of marketing capabilities.
In many service operations, customers have repeated interactions with service providers. This creates two important questions for service design. First, how important is it to maintain the continuity of service for individuals? Second, since maintaining continuity is costly and, at times, operationally impractical for both the organization (due to potentially lower utilization) and providers (due to high effort required), should certain customer types, such as those with complex needs, be prioritized for continuity?
We examine whether changes to corporate governance arising from board reforms affect corporate tax behavior. While the relation between corporate governance and tax behavior has been the subject of intense interest in the literature, prior research has been hampered by a lack of exogenous variation.
We study how the government of a developing country optimizes its local content requirement (LCR) policy to maximize social welfare in a setting where foreign original equipment manufacturers (OEMs) produce and sell multicomponent products in the developing country. The foreign OEMs’ local sourcing of components is more costly than global sourcing because of technology gaps between local and global suppliers.
Cisco Chairman & CEO Chuck Robbins's conversation with UNC Kenan-Flagler Business School Dean Doug Shackelford on April 25 was highlighted in a Triangle Business Journal article. Robbins talked candidly about leadership lessons, geopolitical issues and Triangle accolades.
In a recent paper, “Demystifying Illiquid Assets – Expected Returns for Private Equity,” Ilmanen, Chandra and McQuinn (of AQR) give a perspective on the past, present, and expected future performance of private equity. They conclude that “private equity does not seem to offer as attractive a net-of-fee return edge over public market counterparts as it did 15-20 years ago from either a historical or forward-looking perspective.” This analysis provides our perspective based on more recent and, we think, more reliable data and performance measures – the historical perspective is more positive than Ilmanen et al. portray.
Backhanded compliments seem like praise but can leave a sting. This study explores the psychology of backhanded compliments. Flatterers deploy backhanded compliments to garner liking while conveying social status. Recipients view praise of this kind as strategic put-downs and penalize would-be flatterers even as the backhanded compliment undermines their motivation and perseverance.