Placement
Students on the Job Market
Students on the Job Market
Please note this page will be updated throughout the fall.
Accounting & Management
Yaxuan Chen
Abstract:
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In this paper, I construct a new measure of organizational culture inconsistency capturing whether the culture communicated by top management is inconsistent with the culture perceived by employees. I provide the first large-sample empirical evidence documenting the distribution of organizational culture inconsistency across industries and explore its correlation with firm characteristics. My findings suggest that both organizational constraints and short-term performance pressures explain organizational culture inconsistency. Specifically, firms with greater geographical dispersion, weaker monitoring ability, less emphasis on long-term performance measures, and higher levels of transient institutional ownership are more likely to be culturally inconsistent. Leveraging local public sentiment towards social movements as an instrument, I show that organizational culture inconsistency has a negative effect on firm value and profitability. Finally, I demonstrate that firms that focus more on culture in the employee selection process are less likely to experience cultural inconsistency. Taken together, this study contributes to the understanding of organizational culture inconsistency as a management control problem and provides important managerial implications for practitioners on how to alleviate such cultural inconsistency.
Botir Kobilov
Abstract:
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Ensuring the transparency and disclosure of business activities is a pressing issue in developing countries, where conventional mechanisms such as augmenting budget allocations for enforcement or leaning on third-party reporting on firms’ transactions often fall short due to weak institutions and limited resources. Using a unique and comprehensive administrative database, I examine the efficacy of two technology-enabled policy interventions in a developing country to reduce the shadow economy. Specifically, I find that mandating the use of online Electronic Fiscal Devices (EFDs), which provide regulators with real-time information on business transactions, increases firms' revenue reporting compliance to tax authorities by at least 13%, an effect that is particularly pronounced among firms that are more exposed to ex-ante regulatory monitoring and enforcement. Furthermore, I find that the program that establishes a direct communication channel with citizens and offers financial rewards to act as enforcement agents to monitor firms’ usage of EFDs increases firms' reported revenues by an additional 34%. In contrast to EFD adoption, the efficacy of this program is concentrated among firms that were less exposed to ex-ante enforcement. Taken together, my findings suggest that regulators can fill the oversight gap left by stretched enforcement resources and improve firm-level reporting by using technologies to monitor firms and use technology-enabled citizens as enforcement agents.
Yina Yang
Abstract:
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I find that the first disclosure regulation on funds’ conflicts of interest (COI) in private equity (PE) funds results in an 8.59% increase in fund value for investors. This effect was primarily driven by buyout funds, which often control opaque private companies, creating additional room for COI. It likely provided new information to fund investors, benefiting funds where COI mitigation negotiation can be challenging. Public enforcement for non- or inconsistent disclosure by newly registered managers plays an important role in driving performance improvements. The disclosure regulation likely reduced search costs for fund investors, as newly registered managers are more likely to retain investors and to raise new funds. My findings underscore the importance of disclosure regulation and information provision in PE funds.
Business Economics
Martin Aragoneses
Abstract:
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The weak performance of aggregate investment in the United States since the 1980s is puzzling because rising corporate valuations and falling interest rates should have stimulated investment. I find the steady decline in the startup rate, by aging firms, has been a force behind this puzzle. Using confidential US Census micro data, I document firm aging depressed aggregate investment since firms invest less intensely with age. In fact, the aggregate effects of firm aging may have masked a micro-level increase in investment. I use the firm age micro data to calibrate a macro model of life cycle investment dynamics. In this neoclassical model, historical changes in startup activity rationalize the boom and bust in aggregate investment and its puzzling relation with profitability and interest rates in the post-war era. While falling entry depressed investment since the 1980s, the recent resurgence in startup activity since the Great Recession may be setting the stage for a future investment boom.
Michael Blank
Abstract:
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We use administrative data from the U.S. Census Bureau to estimate the causal effects of loose credit conditions on firm employment and worker earnings. To obtain random variation in which firms experience reduced credit spreads during booms, we exploit the segmentation of high-yield (BB+ rated) versus investment grade (BBB- rated) firms in credit markets. Loose credit conditions causally generate a boom-bust cycle in employment: high-default risk firms initially engage in significant job creation, but then experience financial distress and destroy these jobs over the next five years. We show that these boom-bust dynamics are transmitted to workers. To obtain random variation in which workers take the jobs created during booms, we exploit the importance of parental connections in determining where labor market entrants first work. We find that recent high-school graduates with parents at high-yield (BB+) firms can more easily find high-paying jobs during credit booms, compared to graduates with parents at investment-grade (BBB-) firms. But ten years later, graduates with BB+ parents have substantially lower relative earnings. The magnitude of these negative long-term effects is comparable to the effect of entering the labor market during a recession. Overall, our results suggest that loose credit market conditions cause firms to create short-lived jobs that expose workers to aggregate downturns and impede their accumulation of human capital.
Jiafeng (Kevin) Chen
Abstract:
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Empirical Bayes shrinkage methods usually maintain a prior independence assumption: The unknown parameters of interest are independent from the known precision of the estimates. This assumption is often theoretically questionable and empirically rejected, and imposing it inappropriately may harm the performance of empirical Bayes methods. We instead model the conditional distribution of the parameter given the standard errors as a location-scale family, leading to a family of methods that we call CLOSE. We establish that (i) CLOSE is rate-optimal for squared error Bayes regret, (ii) squared error regret control is sufficient for an important class of economic decision problems, and (iii) CLOSE is worst-case robust when our location-scale assumption is mis-specified. We use our method to select high-mobility Census tracts targeting a variety of economic mobility measures in the Opportunity Atlas (Chetty et al., 2020; Bergman et al., 2023). Census tracts selected by CLOSE are more mobile on average than those selected by the standard shrinkage method. The gain of CLOSE over the standard shrinkage method is substantial relative to two benchmarks.
Angela Ma
Abstract:
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In this paper, I estimate the effects of the commercial eviction moratorium (CEM) policy on business closure and employment during the Covid-19 pandemic. CEM temporarily prohibits commercial evictions and gives business tenants more time to pay rent, thereby providing liquidity relief. I construct an instrument for CEM using pre-pandemic partisanship and controlling for alternative channels through which partisanship may affect businesses. I find that CEM significantly reduces business closure in the short run in both retail and food services but has long-run effects only in food services. Consistent with the mechanism that CEM provides liquidity relief, CEM is more effective in reducing long-run closure for businesses that are more solvent coming into the pandemic, and CEM reduces business take-up of costly loans but does not affect take-up of grants. Turning to employment, the impact of CEM operates along an extensive margin through a reduction in business closure, rather than along an intensive margin through a change in employment while a business is in operation. The total impact of CEM on employment is a preservation of 0.98 percentage points of pre-pandemic employment, which equals 39% of the estimated effects of the Paycheck Protection Program.
Faculty Advisor(s):
Jeremy Stein (Chair), Adi Sunderam, Robin Greenwood, Emily Williams, and Edward Glaeser
Kunal Sangani
Abstract:
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I examine the relationship between customer income and firm markups using rich data on household transactions and wholesale costs. Over the observed purchases, high-income households pay 15pp higher retail markups than low-income households. Half of the markup gap is due to differences in markups paid at the same store. Conditional on income, markups paid by a household also increase when a household shops in high-income areas, at retail chains with locations in other high-income areas, or when purchasing products with a high-income customer base. A model in which household search intensity depends on opportunity cost of time can account for these facts. Consistent with the model’s predictions, I document that retail markups across cities rise with both per-capita income and inequality. Through the lens of the model, changes in the income distribution since 1950 account for a 10–14pp rise in retail markups, with 25 percent of the increase due to growing income dispersion. The rise in markups consists of within-firm markup increases as well as a reallocation of sales to high-markup firms, which occurs without any change to the nature of firm production or competition.
Hanbin Yang
Abstract:
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Using data from a near-universe of 401(k) plans, I document a large dispersion in 401(k) plan fees across employers. An employer at the 90th percentile offers a plan that charges employee participants over 70 basis points higher fees than an employer at the 10th percentile. This fee dispersion has sparked recent lawsuits, with participants using instances of high fees to accuse their employers of violating their fiduciary duties. I demonstrate that much of this dispersion is a natural outcome in a negotiated-price market with transaction costs and heterogeneous services. Therefore, the variation in fees may not necessarily suggest that employers violate their fiduciary duties. Using a structural model that combines employers' provider choices and providers' dynamic fee competition, I estimate that differences in markups between employers only explain 26% of the fee dispersion. I also find that a modest level of transaction costs is optimal for lowering plan fees due to providers' dynamic incentives. While eliminating transaction costs decreases fees by 4%, modest transaction costs result in a larger fee reduction of 9%.
Marketing
Jimin Nam
Abstract:
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Online discourse related to discrimination, including complaints about firm actions, has surged in recent years. While consumer complaints about discriminatory behavior by firms are often rooted in reality, they may at times contain distortions from the truth (e.g., false attributions, exaggerations) regarding experiences of differential treatment based on their membership in certain social categories. Combining evidence from Twitter with five incentive-compatible, online experiments, I investigate consumer motivations behind mentioning discrimination in their complaints within the context of airline customer service. I find that consumers perceive mentions of discrimination to be effective in eliciting a firm’s response, and this view is confirmed by Twitter data on major U.S. airlines: tweets mentioning discrimination-related words elicit faster responses from airlines. This is because consumers consider complaints mentioning discrimination (e.g., “I’ve been discriminated against”) as particularly damaging to the firm’s reputation. As a result, in settings where firms are more concerned about their reputation (e.g., public channels, corresponding track records), consumers are more inclined to strategically mention discrimination in their complaints, even when it is ambiguous whether discrimination actually occurred.
Organizational Behavior
Hanne Collins
Abstract:
Dominika Randle
Abstract:
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The prevailing theory of innovation is that breakthroughs emerge from the recombination of technological knowledge elements. However, this narrow conceptualization of the nature of knowledge involved in firms’ inventive searches leaves largely unexplained the question of why similar firms following seemingly equivalent technological search strategies differ in their abilities to develop breakthroughs. In this paper, I argue that innovation is not simply a process of exploring technological spaces, but also application or market spaces. Accordingly, my theory reconceptualizes the breakthrough development process as one involving search across two dimensions of a theoretical knowledge field: technological knowledge and application knowledge. Just as a firm’s search has been traditionally characterized as exploration or exploitation based on its familiarity with technological knowledge, in my model, it is also characterized as more or less exploratory based on a firm’s familiarity with application knowledge. Using three decades of data on firms’ patenting activities and a novel measure of search (Application Focal Proximity), I investigate the nature of application knowledge searches that are linked to breakthroughs. I find that (1) an application search trajectory that beings with a period of exploration and culminates in a period of exploitation and (2) the intensity of focus on a given application space in the final stages of an invention’s development are both positively associated with breakthrough creation. My research contributes to the literature on firm innovation and breakthrough creation.
Julie Yen
Abstract:
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The idea that well-being interventions can enhance both worker well-being and organizational performance has led many organizations to frame them as a “win-win,” suggesting that there is a “business case” for well-being. Drawing on an ethnography of a company that implemented and later rolled back a 4-day workweek, this paper explores the challenge of sustaining well-being interventions through an investigation of how they are contested. Findings illustrate the key role of how organizations manage tensions between social and financial goals. The company implemented the 4-day workweek with the dual goals of improving well-being (a social goal) and improving productivity (a financial goal). There was consensus that the intervention improved well-being, and administrative data showed neither large increases nor large decreases in productivity. Yet despite strong support from workers and the CEO, a few executives successfully argued to end the 4-day workweek using a two-pronged resistance strategy targeting each of the intervention’s stated dual goals. First, resisters generated concern about productivity by asserting that the 4-day workweek had failed to deliver promised productivity gains, and by arguing that productivity was a trade-off against well-being. Second, they delegitimized well-being improvements by downplaying them and by mobilizing business norms that valorize hard work and financial goals. Ambiguity and subjectivity in how productivity was understood and measured enabled resisters’ strategy and constrained promoters’ advocacy. This study contributes to scholarship on worker well-being in organizations by showing that the use of a win-win framing to motivate well-being interventions can contribute to their fragility.
Strategy
Daniel Brown
Abstract:
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This paper examines the impact of reduced resource redeployment costs on market entry, entry mode, and organizational structure, using changes in state-level occupational licensing rules for lawyers. My findings suggest that firms are more likely to enter a market when redeployment costs drop, yet less likely to enter using a new physical establishment (greenfield investment). Moreover, the study indicates that firms increase their managerial span of control in response to lower redeployment costs. Relatedly, firms increase the level of worker specialization since expanded market access enables workers to concentrate on a greater depth of specialized knowledge. With these new opportunities for flexible firm expansion, firm performance improves as redeployment costs decrease. Overall, these results imply that firms adopt new entry modes and organizational structures when facing lower redeployment costs to effectively reallocate resources as market conditions evolve
Innessa Colaiacovo
Abstract:
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Hiring beyond the founding team is essential to scaling a venture, but labor and search are extremely costly. What hiring strategies do entrepreneurs use, and how do they think about setting compensation for their employees? I conduct a novel survey and experiment with 540 founders of growth-capable U.S. startups that have, on average, 18 employees and $6.8 million of funding. Entrepreneurs initially described hiring and compensation setting at their own firms and then were asked for their best advice about wages for four fictitious job postings. This paper shows that founders report being involved in all aspects of the hiring process, even at the minority of startups that have human resources staff. Startups are less likely than established firms to use paid consultants or wage benchmarking data, relying instead on word-of-mouth advice and free online services to research compensation. Entrepreneurs’ wage advice is highly dispersed and sensitive to information, particularly when the entrepreneur is a first-time founder or lacks experience with a given job. Finally, soliciting a “fair” wage rather than framing wages as a cost induced non-male entrepreneurs to recommend wages that were $11,000 higher, on average. Taken together, these results suggest that startup hiring is a founder-centric process and that wages at startups may be influenced both by available information and by founders’ own utility, beliefs, and preferences.
Technology & Operations Management
Maya Balakrishnan
Abstract:
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Even if algorithms make better predictions than humans on average, humans may sometimes have private information which an algorithm does not have access to that can improve performance. How can we help humans effectively use and adjust recommendations made by algorithms in such situations? When deciding whether and how to override an algorithm's recommendations, we hypothesize that people are biased towards following a naïve advice weighting (NAW) heuristic: they take a weighted average between their own prediction and the algorithm's, with a constant weight across prediction instances, regardless of whether they have valuable private information. This leads to humans over-adhering to the algorithm’s predictions when their private information is valuable and under-adhering when it is not. In an online experiment where participants are tasked with making demand predictions for 20 products while having access to an algorithm’s recommendations, we confirm this bias towards NAW and find that it leads to a 20-61% increase in prediction error. In a follow-up experiment, we find that feature transparency – even when the underlying algorithm is a black box – helps users more effectively discriminate when and how to deviate from algorithms, resulting in a 25% reduction in prediction error.
Caleb Kwon
Abstract:
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Forthcoming.
Daniel Yue
Abstract:
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While corporate involvement in modern scientific research is an indisputable fact, the impact of corporate involvement on scientific progress is controversial. Corporate interests can lead to constraints that redirect research activities into applied problems in a way that benefits the company but reduces scientific impact. However, corporations also provide resources such as funding, data sets, collaborators, engineers, and technical problems that researchers may otherwise be unable to access or know about, spurring knowledge creation. This paper empirically assesses the impact of corporate involvement on scientific research by focusing on dual-affiliated artificial intelligence researchers located at the intersection of academia and industry. After controlling for the researcher's quality and topic preferences, I find that corporate involvement leads to up to a 44% increase in field-weighted citations received by a paper. I document evidence that this effect is driven by the resource-constraint tradeoff. Specifically, I show that corporate involvement significantly increases the likelihood of a breakthrough paper and that these effects are magnified by the involvement of firms with greater resources. However, corporate involvement also alters the direction of the dual-affiliate author's research to be more aligned with the firm's commercial interests. This is the first large-scale quantitative study of any field of science to demonstrate a direct positive effect of corporate involvement on science or to describe the underlying mechanism.