Columbia Business School Research

Information provision in games influences behavior by affecting agents' beliefs about the state, as well as their higher-order beliefs. We first characterize the extent to which a designer can manipulate agents' beliefs by disclosing information. We then describe the structure of optimal belief distributions, including a concave-envelope representation that subsumes the single-agent result of Kamenica and Gentzkow (2011). This result holds under various solution concepts and outcome selection rules.

We consider a portfolio selection problem for an investor who consumes at the end of a finite horizon. With important qualifications on the sufficiency part, we show that convergence of the optimal investment policy as the horizon becomes distant occurs if and only if the corresponding Arrow-Pratt coefficient of relative risk aversion converges as wealth increases. A major step in the proof shows that convergence of the Arrow-Pratt coefficient of relative risk aversion is equivalent to regular variation of the marginal utility function.

Economic frictions pervade the founding, financing, growing, and exiting of high-growth entrepreneurial firms. This chapter considers one friction that currently affects a small, but important, set of entrepreneurs: racial and gender discrimination. I first collect facts from a large empirical literature that show clear gender and race gaps in participation and financing of startups. Female founders manage 16-25% of all startups, while Black entrepreneurs rarely exceed 3% of the startup population.

We study the role of commitment in communication and its interactions with rules, which determine whether information is verifiable. Our framework nests models of cheap talk, information disclosure, and Bayesian persuasion. It predicts that commitment has opposite effects on information transmission under the two alternative rules. We leverage these contrasting forces to experimentally establish that subjects react to commitment in line with the main qualitative implications of the theory. Quantitatively, not all subjects behave as predicted.

We provide evidence that in certain contexts, firms set upward-striving goals and that this upward striving yields significant performance and visibility benefits. We develop a model of variable attention in which, as firms’ performance levels approach cognitively salient round numbers, managers strategically shift their focus from easier-to-reach goals based on historical and social reference points to more challenging goals that provide external visibility and capital market benefits.

Evaluations play a critical role in the allocation of resources and opportunities.
Although evaluation systems are a cornerstone of organizational and market
processes, they often reinforce social and economic inequalities. The body of
organizational research on inequality and evaluations is extensive, but it is also
fragmented, siloed within specific contexts and types of evaluations (e.g., hiring,
performance). As a result, we currently lack a systemic understanding of the
conditions under which inequalities emerge. This paper provides a unifying

Research on campaign finance suggests that Americans prefer candidates that are not funded by Political Action Committees (PACs). However, prior research has not examined how perceptions of a candidate who is PAC-funded vs. PAC free might differ for racial minority and female candidates compared to White, male candidates. Using experimental vignettes, we test the causal impact of PAC funding, race, and gender on voter perceptions of the candidate.

New laws aim to reduce inequality by limiting the information employers can seek. Although employers are forbidden from seeking certain information, workers are free to disclose voluntarily. A large survey of the US workforce shows that men are more likely to disclose their salaries unprompted, particularly when they believe that other candidates are volunteering. Women report higher disclosure costs (particularly non-pecuniary psychological or cultural costs), and are more likely to resist disclosing (even if others disclose).

Widespread narratives about leadership often emphasize the importance of exhibiting agentic traits like assertiveness, ambition, and confidence. Counter to this perspective, the present research suggests that when evaluating leaders, followers especially value communal traits, such as honesty, open-mindedness, and compassion—even at the expense of agentic traits. Eight preregistered studies reveal that people describe their ideal leader as more communal than the typical leader, representing a divide between preferred versus prototypical leaders.

The equity variance risk premium is the expected compensation earned for selling variance risk in equity markets. The variance risk premium is positive and shows only moderate persistence. High variance risk premiums coincide with the left tail of the consumption growth distribution shifting down. These facts, together with risk neutral skewness being substantially more negative than physical return skewness, refute the bulk of the extant consumption-based asset pricing models. We introduce a tractable habit model that does fit the data.