At Columbia Business School, our faculty members are at the forefront of research in their respective fields, offering innovative ideas that directly impact the practice of business today. A quick glance at our publication on faculty research, CBS Insights, will give you a sense of the breadth and immediacy of the insight our professors provide.
As a student at the School, this will greatly enrich your education. In Columbia classrooms, you are at the cutting-edge of industry, studying the practices that others will later adopt and teach. As any business leader will tell you, in a competitive environment, being first puts you at a distinct advantage over your peers. Learn economic development from Ray Fisman, the Lambert Family Professor of Social Enterprise and a rising star in the field, or real estate from Chris Mayer, the Paul Milstein Professor of Real Estate, a renowned expert and frequent commentator on complex housing issues. This way, when you complete your degree, you'll be set up to succeed.
Columbia Business School in conjunction with the Office of the Dean provides its faculty, PhD students, and other research staff with resources and cutting edge tools and technology to help push the boundaries of business research.
Specifically, our goal is to seamlessly help faculty set up and execute their research programs. This includes, but is not limited to:
All these activities help to facilitate and streamline faculty research, and that of the doctoral students working with them.
The article offers the authors' views on expatriate management programs and the benefits from executives interacting with the people and institutions of the host country. The idea that international experience or interaction between foreign managers and local people will help managers become more creative, entrepreneurial, and successful is discussed. The concept of integrative complexity in bi-cultural managers which enhances job performance is mentioned.
The Kidney Case is multi-person exercise that involves the allocation of a single kidney. Students read profiles of eight candidates for the kidney and make a first allocation decision. Each candidate was designed to be high on some allocation principles but low or unknown on others (e.g., best, match, time in cue, age, personal responsibility for disease, future benefits to society, etc.). Then, students are put into groups and assigned to advocate for one of the candidates. Each group will prepare and give a 3-minute presentation on why their candidate should receive the kidney.
Emissions abatement alone cannot address the consequences of global warming for weather disasters. We model how society adapts to manage disaster risks to capital stock. Optimal adaptation — a mix of firm-level efforts and public spending — varies as society learns about the adverse consequences of global warming for disaster arrivals. Taxes on capital are needed alongside those on carbon to achieve the first best.
What are the sources of the returns to education? We study the allocation of higher education graduates from public institutions in Ohio across firms. We present three results. First, we confirm findings in the earlier literature of large pay differences across degrees. Second, we show that up to one quarter of pay premiums for higher degrees are explained by between-firm pay differences. Third, higher education degrees are associated with greater representation at the best-paying firms.
This article focuses on the role of threats in negotiations. Broadly speaking, a threat is a proposition that issues demands and warns of the costs of noncompliance. Even if neither party resorts to them, potential threats shadow most negotiations. Researchers have found that people actually evaluate their counterparts more favorably when they combine promises with threats rather than extend promises alone. Whereas promises encourage exploitation, the threat of punishment motivates cooperation.
Many state and local governments incentivize new business creation. I analyze local growth policy in a setting where firm entry and expansion choices exhibit local complementarities, creating dynamic misallocation at the aggregate level. Optimal entry subsidies would speed the transition of Rust-belt workers to the South and Mountain West by an extra 10 million people by 2035, raising real incomes by 4%. Actual subsidies substantially worsen misallocation, lowering welfare by 3%, 6 times the size of the subsidies themselves.
We propose one route to a more inclusive society. Our context is the prevailing one of high wealth inequality where stockholders alone supply the stochastic discount factor governing the allocation of capital. A large and pervasive pecuniary externality is thus imposed on non-stockholder workers, something we view as antithetical to the notion of an inclusive society.
Routines shape many aspects of day-to-day consumption. While prior work has established the importance of habits in consumer behavior, little work has been done to understand the implications of routines — which we define as repeated behaviors with recurring, temporal structures — for customer management. One reason for this dearth is the difficulty of measuring routines from transaction data, particularly when routines vary substantially across customers. We propose a new approach for doing so, which we apply in the context of ridesharing.
As long as coal plants are still operating, it is a good idea to require them capture their carbon dioxide emissions. But those designing policies to hasten such practices must tread carefully, lest they unwittingly extend the life of dirtier energy sources.
We develop a financial-economic model for carbon pricing with an explicit representation of decision making under risk and uncertainty that is consistent with the Intergovernmental Panel on Climate Change’s sixth assessment report. We show that risk associated with high damages in the long term leads to stringent mitigation of carbon dioxide emissions in the near term, and find that this approach provides economic support for stringent warming targets across a variety of specifications.
NEW YORK – Climate change is no longer a future problem. It is here, and the effects are all around. Worse, today’s extreme weather events are just a preview of the pain that awaits humanity in the coming decades, almost regardless of how fast we manage to decarbonize the economy this year or next.
In the landscape of low carbon sources of energy, nuclear power stands out as an option that has generated increasing attention and capital investment. Since 2001, nuclear energy production has been in decline, though Clean Core Thorium Energy, led by Mehul Shah, is one of the companies that is bringing nuclear back to the forefront. Founded in 2017, Clean Core is a nascent player in an industry that has a poor reputation among investors.
Voestalpine, the Austria-based global leading steel manufacturing division of High Performance Metals, has made a bold commitment. It would achieve climate neutrality by 2050, with chief sustainability officer Philipp Horner leading the charge. Horner and his strategy team must review its entire manufacturing process to find opportunities for decarbonization, including learning about completely new methods for production and reevaluating its existing blast furnace technology.
The plan to charge drivers to enter Manhattan south of 60th Street, which last month moved closer to federal approval, will deliver two notable gifts to New York and the region when it begins, perhaps as soon as next April.
It’s days like today that I wished I had former Alaska Gov. Sarah Palin’s superpower and could “love that smell of the emissions,” or at least was immune to them. In reality, of course, nobody is. But reading statistics about millions a year dying from air pollution caused by the burning of fossil fuels is one thing.
To think that technology will save us from climate change is to invite riskier behavior, or moral hazard. Whether a climate technology creates new problems has little to do with the solution, and everything to do with us.
We consider a New Keynesian model with strategic monetary and fiscal interactions. The fiscal authority maximizes social welfare. Monetary policy is delegated to a central bank with an anti-inflation bias that suffers from a lack of commitment. The impact of central bank hawkishness on debt issuance is non-monotonic because increased hawkishness reduces the benefit from fiscal stimulus while simultaneously increasing real debt capacity.
We study a regulation in Chile that mandates warning labels on products whose sugar or caloric concentration exceeds certain thresholds.We show that consumers substitute from labeled to unlabeled products—a pattern mostly driven by products that consumers mistakenly believe to be healthy. On the supply side, we find substantial reformulation of products and bunching at the thresholds.
Now that the only thing as certain as death and taxes is climate change, it is perhaps no surprise that the Internal Revenue Service is critical to emissions policy.
This paper studies the implications of central bank credibility for long-run inflation and inflation dynamics. We introduce central bank lack of commitment into a standard non-linear New Keynesian economy with sticky-price monopolistically competitive firms.Inflation is driven by the interaction of lack of commitment and the economic environment. We show that long-run inflation increases following an unanticipated permanent increase in the labor wedge or decrease in the elasticity of substitution across varieties. In the transition, inflation overshoots and then gradually declines.
We propose a political economy mechanism that explains the presence of fiscal regimes punctuated by crisis periods. Our model focuses on the interaction between successive deficit-biased governments subject to i.i.d. fiscal shocks. We show that the economy transitions between a fiscally responsible regime and a fiscally irresponsible regime, with transitions occurring during crises when fiscal needs are large. Under fiscal responsibility, governments limit their spending to avoid transitioning to fiscal irresponsibility.
The Covid-19 pandemic has accelerated the trend of many colleges moving to testoptional, and in some cases test-blind, admissions policies. A frequent claim is that by not seeing standardized test scores, a college is able to admit a student body that it prefers, such as one with more diversity. But how can observing less information allow a college to improve its decisions? We argue that test-optional policies may be driven by social pressure on colleges’ admission decisions.
The US Inflation Reduction Act is a landmark legislative package that should be welcomed around the world, despite its putatively protectionist features. Owing to the positive learning-by-doing spillovers that follow from green subsidies, Europe and the rest of the world ultimately will benefit, too.
Building infrastructure is hard; building a trillion dollars’ worth of infrastructure within a decade, while jump-starting U.S. manufacturing and protecting fragile ecosystems, is harder still. But if President Biden’s climate finance windfall is to position the United States to lead on clean-energy jobs, trade and innovation, that building needs to start now.
Attempting to shield Earth from the sun’s rays in what’s often described as a last-ditch effort to cool average global temperatures is controversial for good reason. It might work and do a lot of good, but there are ample risks. Most importantly, it is no replacement for cutting greenhouse gases. Researchers who study the approach most closely are the first to say just that. Using solar geoengineering as the latest excuse not to slash carbon and other pollution would be a mistake. But research we must.
Rules are being drafted to guide compliance with a 2019 New York City law that requires most of about 50,000 buildings, many over 25,000 square feet, to cut their greenhouse gas emissions by 40 percent by the end of this decade and to achieve net-zero emissions by 2050.
To study the impacts of NewYork’s 2018 Paid Family Leave (PFL) policy on employer outcomes, we designed and fielded a survey of small firms in NewYork and a control state, Pennsylvania, which does not have a PFL policy. We match each NY firm to a comparable PA firm and use difference-in-differences models to analyze within-match-pair changes in outcomes. Contrary to common concerns about the burdens of PFL on employers, we find no evidence that PFL had any adverse impacts on employer ratings of employee performance or their ease of handling long employee absences.
Speeding up the adoption of already proven and scalable technologies, and exposing the many hidden costs associated with fossil fuels, is a necessary goal. Achieving it will require new policies to guide investments in the right direction, and techno-optimists ought to be the loudest advocates.
How does protecting the privacy of consumers affect the value of their personal data? We model an intermediary that uses consumers' data to influence the price set by a seller. When privacy is protected, consumers choose whether to disclose their data to the intermediary. When privacy is not protected, the intermediary can access consumers' data without their consent. We illustrate that protecting consumers' privacy has complex effects. It can increase the value of some consumers' data while decreasing that of others.
Personal data is an essential input for the digital economy. Yet, individuals often have limited control over its use and are rarely compensated for it. What inefficiencies does this status quo generate? Which market institutions could improve upon it? We study the competitive equilibria of an economy where platforms acquire consumers' data and use it to intermediate consumers and sellers. We find that granting consumers control over their data can backfire: It can lead to lower social welfare than when consumers are simply expropriated of their data.
The US Securities and Exchange Commission is considering a proposal to require some companies to disclose information relating to the risks they face from climate change. But the agency is coming under pressure to scrap or water down the proposal because of a recent Supreme Court decision.
In the face of a massive financing gap for climate-change mitigation and adaptation in developing countries, everyone accepts the need for more "creative" measures to unlock and redirect private capital. But proposals like carbon credits must be understood merely as stepping stones, rather than as lasting solutions.
This article reviews the evidence on the impacts of paid family and medical leave (PFML) policies on workers’ health, family well-being, and employer outcomes. While an extensive body of research demonstrates the mostly beneficial effects of PFML taken by new parents on infant, child, and parental health, less is known about its impact on employees who need leave to care for older children, adult family members, or elderly relatives. The evidence on employers is similarly limited but indicates that PFML does not impose major burdens on them.
Many e-commerce platforms use buyers' personal data to intermediate their transactions with sellers. How much value do such intermediaries derive from the data record of each single individual? We characterize this value and find that one of its key components is a novel externality between records, which arises when the intermediary pools some records to withhold the information they contain. Ignoring this can significantly bias the evaluations of data records.
How does task expertise affect the allocation of attention?
A lot of today’s widespread confusion about climate change—some of it unwitting, some of it deliberately cultivated—stems from the critical miscommunication of two little words: risk and uncertainty. To most of the public, risk means a danger that must be addressed, whereas uncertainty means a lack of clarity about whether there is any meaningful danger at all. To scientists and economists like myself, uncertainty has a starkly different meaning. It is worse than risk; it indicates the possible range of just how bad a (very real) danger will be.
Although businesses and investors stand to make a lot of money if they can properly navigate the new risk environment, no one seems to have a good explanation for why we are where we are. Climate risks, in particular, have been systematically underestimated, and thus mispriced, for decades.
California is finally poised to lift parking requirements across the state. Here’s why that would be a huge win for the climate.
Moral hazards are ubiquitous. Green ones typically involve technological fixes: Environmentalists often see ‘technofixes’ as morally fraught because they absolve actors from taking more difficult steps toward systemic solutions. Carbon removal and especially solar geoengineering are only the latest example of such technologies. We here explore green moral hazards throughout American history. We argue that dismissing (solar) geoengineering on moral hazard grounds is often unproductive.
Climate change is beset with unpleasant surprises. Yields of maize (corn), wheat, rice and soya beans all fall precipitously when temperatures exceed certain thresholds — for example, 29 °C for maize. These four staple crops together account for 75% of the calories consumed by humans, so the non-linear temperature dependence of their yields calls for rapid action to avoid the tipping points, either by limiting the carbon dioxide emissions that are warming the planet or by relocating crop fields on a vast scale — probably both.
We study a fiscal policy model in which the government is present-biased towards public spending. Society chooses a fiscal rule to trade off the benefit of committing the government to not overspend against the benefit of granting it flexibility to react to privately observed shocks to the value of spending. Unlike prior work, we examine rules under limited enforcement: the government has full policy discretion and can only be incentivized to comply with a rule via the use of penalties which are joint and bounded. We show that optimal incentives must be bang-bang.
Introduction for Special Issue in Honor of Martin Weitzman.
While no legislation is perfect, the US Inflation Reduction Act of 2022 will be a game changer for the transition to clean-energy sources, both in America and around the world. By doubling down on forward-looking industrial policy, the US is suddenly poised to give Europe, China, and others a run for their money.
Cutting carbon cuts "fossilflation" — and yes, that needs to be balanced against "greenflation." The Inflation Reduction Act tackles both, but getting the balance right will be key.
Should businesses worry about climate risk because doing so is good for their bottom line, or because their responsibilities ought to go beyond mere financial returns to shareholders? What if expanding one’s lens to include environmental, social, and corporate governance turns out to be good for business? What if not? These fundamental questions lie at the core of numerous ambitious efforts to align tools and resources of finance with global action to address climate change.
It is hard to look at a crisis like Russia’s invasion of Ukraine and see a moment of opportunity. We—to say nothing of Ukrainians—are still very much in a crisis, and a compounding one at that, with potential long-lasting economic and political consequences.
We consider optimal government debt maturity in a deterministic economy in which the government can issue any arbitrary debt maturity structure and in which bond prices are a function of the government's current and future primary surpluses. The government sequentially chooses policy, taking into account how current choices - which impacts future policy -- feed back into current bond prices. We show that issuing consols constitutes the unique stationary optimal debt portfolio, as it boosts government credibility to future policy and reduces the debtfinancing costs.
As unfunded pension liabilities grow, governments experiment with ways to curb costs. We examine the effect of a representative cost-cutting reform on the retention and productivity of workers. The reform reduced pension annuities and increased penalties for early retirement, projected to save 8 percent of revenues. We leverage administrative records and a discontinuity in the reform to estimate its effect on labor supply. The reform slightly increased worker retention, and we can rule out small attrition effects. The reform had no effect on worker output.
Climate change brought on by human activities lead to acute and chronic hazards that threaten the planet; to reduce the chances of the most dangerous and irreversible damage, the global community must reduce the emission of greenhouse gases, notably carbon dioxide. While more than 70 countries (~80% of global CO2 emissions and ~90% of global GDP) and over 5,000 influential companies have adopted net-zero commitments, coordination of an effort to this scale, given the complex economic, societal, governance and infrastructure considerations, is no easy feat.
We analyze a model of hierarchies in organizations in which neither decisions nor the delegation of decisions is contractible and in which power-hungry agents derive a private benefit from making decisions. Two distinct agency problems arise and interact: subordinates make more biased decisions (which favors adding more hierarchical layers), but uninformed superiors may fail to delegate (which favors removing layers). A designer may remove intermediate layers of the hierarchy (eliminate middle managers) or flatten an organization by removing top layers (eliminate top managers).
Investing in the next generation of nuclear reactors could give the world an important tool for reducing carbon emissions.
We explore the relationship between the volatility of a firm's local environment and its organizational structure. Using micro-level data on managers working for a large retailer, we empirically test and provide support for our theory that a more volatile local environment results in more decentralization only when the need for coordination among sub-units is low. In contrast, more local volatility is associated with more centralization when coordination needs are high.