Up Next

Market-Based Solutions to Vital Economic Issues


Kenan Institute 2024 Grand Challenge: Business Resilience
Market-Based Solutions to Vital Economic Issues



Save the date for IPC's Spring Research Symposium Friday, March 22, 2024. The research symposium brings together academic researchers and industry practitioners to discuss applied research in the broad field of private capital and alternative investments.

2022 has not been kind to many investment portfolios; as Kenan Institute Executive Director Greg Brown argues, this is all attributable to the change in real interest and inflation rates.

Stephen Arbogast, Director of the Energy Center at the Kenan-Flagler Business School, offers an in-depth explanation of supply dynamics in global energy markets--and why oil and gas prices have been so chaotic.

The pandemic taught us that equity investors would be wise to seek to invest in firms with resilient supply chains. But is there a reliable way to identify firms whose supplier-customer relationships are less vulnerable to disruptions?

We analyze the impact of the introduction of credit default swaps (CDSs) on real decision-making within the firm. Our structural model predicts that CDS introduction increases debt capacity more when uncertainty about the credit events that trigger CDS payment is lower.

We examine the links between human capital and endowment investing. Harnessing detailed information on university endowments, we find that higher asset allocations to alternative assets accompany higher levels of human capital in the endowment’s investment process. Moreover, high levels of human capital are linked to larger returns, even on a risk-adjusted basis.

The Biden administration is proposing significant increases in corporate taxes to finance investments in infrastructure and other priorities. Proposed reforms include a global minimum tax on book income and other changes intended to limit the ability of US multinational companies to reduce US tax by shifting investments and reported profits to low-tax foreign countries. In order to promote a competitive global landscape, the administration is concurrently working with the OECD to recommend its members adopt similar changes.

We use detailed establishment-level data to understand whether and how the composition of the US stock market differs from the composition of US firms as a whole. Although the locational composition of employment in public firms is similar to that of all US firms, we find certain industries significantly overrepresented. Further, the gap between the industrial composition of publicly traded firms and all US firms has grown over the last thirty years.

We propose a method for decomposing private fund portfolio performance into effects from timing, strategy selection, geographic focus, sizing of fund allocation, and fund selection attributes.

We conduct an experiment designed to understand how social preferences affect investment decisions by observing subjects’ stock allocations and probability assessments. Key to the design is that subjects’ investment outcomes are treated by neutral, negative or positive payoff externalities on social causes. Our findings of asymmetric responses in probability perceptions and allocations suggest negative, but not positive, responsible investment (RI) externalities have significant effects.

Angel investor tax credits are commonly used around the world to spur entrepreneurship. Exploiting the staggered implementation of these tax credits in 31 U.S. states, we find that while they increase angel investment, marginal investments flow to relatively low-growth firms. 

The Small Business Investor Alliance surveyed the small business portfolios of Small Business Investment Companies to measure the impact the pandemic is having on their operations and employment. Small businesses are facing extreme cash flow concerns. Small businesses are already laying off a substantial number of employees and without a significant change in trajectory, layoffs are anticipated to increase tremendously. Data analysis provided by the Kenan Institute of Private Enterprise.