Experience Faculty & Research

In my native Jamaica, hardscrabble industry manifests everywhere: Pushcarts in saturated colors are deployed across the island—bits of scrap lumber slapped together with cast-off wheels and a steering column, then piled high with coconuts and pineapples or weighed down with a hodgepodge of extension cords, toilet plungers, and belts for sale. On the outskirts of Kingston, a tire repair shop as unlikely as it is ingenious runs on machines made by hand from discarded car parts no longer useful for their original purposes. Read more

• Biography: Dean Peter Blair Henry
• Department: Economics

Do we really think of our older selves as strangers? And can digitally altered photos really improve our judgment? Professor Hershfield, defend your research. Read more

• Biography: Professor Hal Hershfield
• Department: Marketing

In a recent set of studies, Carmen Reinhart and Kenneth Rogoff used a vast array of historical data to show that the accumulation of high levels of public (and private) debt relative to GDP has an extended negative effect on growth. The size of the effect incited debate about errors in their calculations. Few, however, doubt the validity of the pattern. Read more

• Biography: Professor A. Michael Spence
• Department: Economics

Barry Diller’s new Aereo venture may turn out to be the ultimate Catch-22. Aereo is possible only because of the existence of broadcast television, but broadcasters view it as a threat and have warned that they may stop broadcasting. If that happens, broadcast television and Aereo could both cease to exist. Read more

• Biography: Professor Lawrence White
• Department: Economics

Apple’s decision last week to issue $17bn in bonds has drawn attention to America’s abominable corporate tax system. The tech giant’s first debt issue comes at a time when it has more than $100bn in cash held outside the US. By borrowing from the capital markets, Apple can pay dividends to shareholders more cheaply than if it used the money stored outside the country, while getting a tax deduction for interest expenses. This decision has angered those who like to inveigh against “tax avoidance” and “corporate greed”. But the culprit is not Apple; it is the over-complex US tax system. Read more

• Biography: Professor Aswath Damodaran
• Department: Finance

In 2007, according to the McKinsey Global Institute, global financial assets had a combined market value of $202 trillion, a surprisingly large amount and equal to three and a half times’ global gross domestic product. Read more

• Biography: Professor Roy C. Smith
• Department: Finance

Some have praised Disney’s decision to pull out of Bangladesh as a step forward for workers’ rights. It's not. Read more

• Biography: Professor Michael Posner
• Department: Business and Society Program Area

Whenever I give a lecture, I conduct a simple experiment. First I ask the members of the audience to raise a hand if they follow the actor Ashton Kutcher on Twitter. Usually most people’s hands go up—no big surprise. Read more

• Biography: Professor Sinan Aral
• Department: Information, Operations and Management Sciences

Is India different? Last month, India's finance minister confidently declared that nothing could stop his country from becoming the world's third-biggest economy. He may well be right, but size alone does not make India a special case. Its growth has been fast, but it is no trailblazer. Read more

• Biography: Professor Daniel Altman
• Department: Economics

In the last four weeks, I have traveled to Sofia, Kuala Lumpur, Dubai, London, Milan, Frankfurt, Berlin, Paris, Beijing, Tokyo, Istanbul, and throughout the United States. As a result, the myriad challenges facing the global economy were never far away. Read more

• Biography: Professor Nouriel Roubini
• Department: Economics

Ingo Walter just wrote an intriguing piece on “Thoughts on Reputation and Governance in Banking,” (hyperlink to Ingo’s piece) inspiring me, as he often does, to put my own two sense into the conversation. Read more

• Biography: Professor Frederick C. Militello, Jr.
• Department: Finance

It is only a few days after the announcement that conglomerate PPR is changing its name to Kering and the snide remarks continue.There are mainly two groups of analysts who dismiss the change of name: news analysts who continue to view the conglomerate as a portfolio of disparate brands, the strategy of which they are unable to articulate; and financial analysts whose interest is focused on financial results exclusively. Read more

• Biography: Professor Thomaï Serdari
• Department: Marketing

The epic financial crisis of a few years ago inflicted immense damage on the process of financial intermediation, the fabric of the real economy, and the reputation of banks and bankers. Even today, some five years later, little has happened to restore financial firms to their former glory near the top of the reputational food-chain in most countries. For reasons of their own, many boards and managers in the banking industry have little good to say about the taxpayer bailouts and the inevitable regulatory tightening. In the words for former Barclays CEO Bob Diamond, "There was a period of remorse and apology for banks. I think that period is over. Frankly, the biggest issue is how do we put some of the blame game behind us? There's been apologies and remorse, now we need to build some confidence.” Read more

• Biography: Professor Ingo Walter
• Department: Finance

We like to think that making important decisions is the result of careful contemplation and intelligence. But psychologists have uncovered a striking number of cues — some as simple as sunshine — that shape our thoughts, feelings and behaviors below the level of conscious awareness. Read more

• Biography: Professor Adam Alter
• Department: Marketing

Facebook announced a series of incremental updates to Graph Search yesterday — as revealed by a peek under the hood — and I think it’s a good thing they’re doing the feature and user release so gradually. Read more

• Biography: Professor Arun Sundararajan
• Department: Information, Operations, and Management Sciences

The Justice Department’s suit against Standard & Poor’s is a fresh reminder of the large mistakes by the three major rating agencies – S.&P., Moody’s, and Fitch – in their evaluations of mortgage-based bonds during 2004-2007. There’s an understandable urge to further regulate bond raters to prevent such mistakes in the future. Read more

• Biography: Professor Larry White
• Department: Economics

The Apple saga is a reminder of how quickly momentum can shift in financial markets. Just six months ago, having released the iPhone 5 and with its stock price peaking at $705, the tech company that changed the way we live and created fabulous wealth for investors was on the top of the world. Read more

• Biography: Professor Aswath Damodaran
• Department: Finance

The unique feature of the global financial crisis that began in 2007 is that it is an amalgam of a financial markets crisis, a banking crisis and a sovereign debt crisis. The crisis began as a credit and financial problem in most countries but soon snowballed into a banking and sovereign crisis. In some cases, such as Ireland, governments took on excess debt and risks while rescuing failed banks or stimulating the economy. And in yet others, such as Spain, private debt and a growth slowdown engulfed governments too. And in yet others, such as Greece and Italy, governments took on excess debt and ran up deficits. These crises indicate the existence of a strong two-way relationship between banking crises and sovereign debt crises. Read more

• Biography: Professor Viral Acharya
• Department: Finance

To make the U.S. financial system safe, we need to end the era of big bailouts. In December, the U.S. and the UK took a significant step in that direction, announcing a common strategy for resolving insolvent cross-border financial giants, known as global systemically important financial intermediaries (G-SIFIs). Read more

• Biography: Professor Thomas Cooley and Professor Kermit Schoenholtz
• Department: Economics

"Great corporations exist only because they are created and safeguarded by our institutions; and it is therefore our right and our duty to see that they work in harmony with these institutions."

That quote is not from an Occupy Wall Street organizer or some modern-day corporate watchdog, but from President Theodore Roosevelt, as part of his First Annual Message to Congress in 1901. Indeed, questions about the actions and purposes of American corporations have been with us as long as corporations themselves. Read more

• Biography: Professor Ralph Gomory and Professor Richard Sylla
• Department: Economics

Tuition-based universities are doing something counterintuitive: competing with each other to deliver their content online and for free. Technology is disrupting the traditional lecture-based model and many believe this new paradigm of instruction is superior in important ways. Read more

• Biography: Professor Vasant Dhar
• Department: Information, Operations, and Management Sciences

“There’s no need to dwell on the past; what matters is the future.” As business historians who consult frequently to companies, we hear some version of this sentiment all the time from executives. When the history of an organization does come up, it’s usually in connection with an anniversary—just part of the “balloons and fireworks,” as one business leader we know characterized his company’s bicentennial celebration (knowing that the investment of time and money would have little staying power). This is not to say that celebrations are unimportant, and we sympathize with managers’ day-to-day need to focus on the steps ahead. A fast-changing world leaves little time for nostalgia and irrelevant details—or, worse, strategies for winning the last war. Read more

• Biography: Professor George Smith
• Department: Economics

Europe these days is more complicated than an episode of Homeland. Last I heard, Germany was still pushing austerity while Greece and Italy complained about its effects. Silvio Berlusconi offered to return if someone could help him with his tax fraud conviction. Catalonia threatened to leave Spain but remain in Europe. David Cameron suggested the European Union headquarters in Brussels ""continues to exist as if in a parallel universe,"" in part because its idea of austerity is to increase the workweek from 37.5 hours to 40.

How can we possibly make sense of all this? Read more

• Biography: Professor David Backus
• Department: Economics

The fiscal cliff negotiations remind us of the long-running game show “Beat the Clock.” Couples had to perform a stunt, such as tying their shoelaces together using only their left hands, before a large clock ticked down to zero. The host would often introduce a twist at the last minute, something like, “Oh, and one more thing, you have to do this while members of the audience throw tomatoes at you.”

President Obama and House Speaker John Boehner must do something far harder than tying their shoelaces together before the clock ticks down to January 1. They have to reach a deal themselves, and then convince majorities in the House and Senate to go along. Oh, and one more thing, they have to do this while being pilloried by their respective bases. What can they do to improve their odds of beating the clock? Moral psychology can help. Read more

• Biography: Professor Jonathan Haidt
• Department: Business and Society Program Area