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.
Markets for information products exhibit varying degrees of competition on both the supply and the demand side. This paper studies the potential complementarity of information products, equilibrium information buying behaviors and information price setting in such markets. Our game-theoretic model consists of two information providers selling imperfect information to two competing clients and allows for different information quality levels as well as varying degrees of client competition.
Accusations of wrongdoing, baseless or justified, can severely tarnish a company's reputation. Once disseminated, even baseless accusations can persist and cause considerable damage for a company. This study examines the proactive crisis communication strategy of inoculating individuals against invalid accusations before they go viral. An experiment was conducted in a real world consumer context among members of an online consumer panel using an electronics discounter as the research stimulus.
We track the evolution of financing of residential real estate through the housing boom in the early- to mid-2000s and the resolution of distress during the bust during the late 2000s. Financial innovation, in the form of non-traditional mortgage products and the expansion of alternative lending channels, namely non-agency securitization, fundamentally altered the mortgage landscape during the boom. We describe the impact of these changes in mortgage finance on borrowers and loan performance, as well as their impact on the resolution of distressed mortgages.
We study the drivers of the emergence of opinion leaders in a networked community where users establish links to others, indicating their "trust" for the link receiver's opinion. This leads to the formation of a network, with high in-degree individuals being the opinion leaders. We use a dyad-level proportional hazard model with time-varying covariates to model the growth of this network. To estimate our model, we use Weighted Exogenous Sampling with Bayesian Inference, a methodology that we develop for fast estimation of dyadic models on large network data sets.
We posit that compared to the cognitive system, the affective system of judgment and decision making is relatively more engaged in the present. Specifically, we hypothesize that even if their accessibility is held constant, affective feelings are weighted more heavily in consumer judgments and decisions set in the present than in equivalent judgments and decisions set in the future or in the past.
Systemic risk is an issue of great concern in modern financial markets as well as, more broadly, in the management of complex systems. We propose an axiomatic framework for systemic risk. Our framework allows for an independent specification of (1) a functional of the cross-sectional profile of outcomes across agents in the system in a single scenario of nature, and (2) a functional of the profile of aggregated outcomes across scenarios of nature.
Frederic Mishkin comments on Takatoshi Ito's chapter "Great Inflation and Central Bank Independence in Japan," expressing doubt that the Bank of Japan achieved de facto independence in 1975. Rather, he sees the bank as continuously subordinated to government pressure throughout the period. What differed at the end of the 1970s was that the government favored tightening. He also posits that the Japanese experience demonstrates that if the central bank has credibility for low inflation that oil price shocks need not be inflationary.
We study a dynamic limit order market with afinite number of strategic liquidity suppliers who post limit orders. Their limit orders are hit by either news (i.e. informed) traders or noise traders. We show that repeatedly playing a mixed strategy equilibrium of a certain static game is a subgame perfect equilibrium with flickering quotes.
Although previous research has shown that making the first offer leads to a distributive advantage in negotiations, the current research explored how the timing of first offers affects the creativity of negotiation agreements. We hypothesized that making the first offer later rather than earlier in the negotiation would facilitate the discovery of creative agreements that better meet the parties' underlying interests. Experiment 1 demonstrated that compared with early first offers, late first offers facilitated creative agreements that better met the parties' underlying interests.
We analyze the role of retail investors in stock pricing using a database uniquely suited for this purpose. The data allow us to address selection bias concerns and to separately examine aggressive (market) and passive (limit) orders. Both aggressive and passive net buying positively predict firms' monthly stock returns with no evidence of return reversal. Only aggressive orders correctly predict firm news, including earnings surprises, suggesting they convey novel cash flow information.
We consider a repeated newsvendor problem in which the decision-maker (DM) does not have access to the underlying distribution of discrete demand. We analyze three informational settings: i) the DM observes realized demand in each period; ii) the DM only observes realized sales; and iii) the DM observes realized sales but also a lost sales indicator that records whether demand was censored or not. We analyze the implications of censoring on performance and key characteristics that effective policies should possess.
As firms increasingly seek out consumers' ideas in various domains, they will encounter individuals with different levels of domain-specific knowledge. While both low- and high-knowledge consumers may be willing to share their ideas benevolently, the performance of the former is likely to be hindered by their lack of relevant knowledge in the problem domain. It is also well established that, despite their abundant knowledge, high-knowledge consumers may not perform in accordance with their full potential (due to factors such as shallow processing and inattention).
Integrating recent work on emotional communication with social science theories on unpredictability, we investigated whether communicating emotional inconsistency and unpredictability would affect recipients' concession-making in negotiation. We hypothesized that emotional inconsistency and unpredictability would increase recipients' concessions by making recipients feel less control over the outcome. In Experiment 1, dyads negotiated face-to-face after one negotiator within each dyad expressed either anger or emotional inconsistency by alternating between anger and happiness.
The current research examines the extent to which visual perception is distorted by one's experience of power. Specifically, does power distort impressions of another person's physical size? Two experiments found that participants induced to feel powerful through episodic primes (Study 1) and legitimate leadership role manipulations (Study 2) systematically underestimated the size of a target, and participants induced to feel powerless systematically overestimated the size of the target. These results emerged whether the target person was in a photograph or face-to-face.
We propose and estimate a structural model of daily stock market activity to test competing theories of trading volume. The model features informed rational speculators and uninformed agents who trade either to hedge endowment shocks or to speculate on perceived information. To identify the model parameters, we exploit enormous empirical variation in trading volume, market liquidity, and return volatility associated with regular and extended-hours markets as well as news arrival. We find that the model matches market activity well when we allow for overconfidence.
As the debate over banking reform continues, the 800-pound gorilla in the room is the anemic market value of America's banks. The market-to-book value ratio of U.S. banks — an indicator of market perceptions of their future cash flow-generating potential — remains in the tank. This ratio averaged between 1.8 and 2.9 from 2000 until mid-2007, but then plunged to an average of between 0.9 and 1.3.
Epidemiological and animal studies often find that higher social status is associated with better physical health outcomes, but these findings are by design correlational and lack mediational explanations. In two studies, we examine neurobiological reactivity to test the hypothesis that higher social status leads to salutary short-term psychological, physiological, and behavioral responses. In Study 1, we measured police officers' subjective social status and had them engage in a stressful task during which we measured cardiovascular and neuroendocrine reactivity.
The health effects of menstruation are a controversial explanation for gender gaps in absenteeism and earnings. This paper provides the first evidence on this issue using data that combines labor market outcomes with information on health. We find that menstrual problems could account for some of the gender gap in illness-related absences, but menstrual problems are associated with other negative health conditions, suggesting our estimates may overstate causal effects. Nevertheless, menstrual problems explain very little of the gender gap in earnings.
We all want to experience pleasure and avoid pain. But there are really two kinds of pleasure and pain that motivate everything we do. If you are promotion-focused, you want to advance and avoid missed opportunities. If you are prevention-focused, you want to minimize losses and keep things working. And as Tory Higgins has found in his groundbreaking research, if you understand how people focus, you have the power to motivate yourself and everyone around you.
Six studies explored the overlap between racial and gender stereotypes, and the consequences of this overlap for interracial dating, leadership selection, and athletic participation. Two initial studies captured the explicit and implicit gender content of racial stereotypes: Compared with the White stereotype, the Asian stereotype was more feminine, whereas the Black stereotype was more masculine.
What is the role of leaders in large organizations? We propose a model in which a leader helps to overcome a misalignment of followers' incentives that inhibits coordination while adapting the organization to a changing environment. Good leadership requires vision and special personality traits such as conviction or resoluteness to enhance the credibility of mission statements and to effectively rally agents around them.
The Attachment-Aversion (AA) Relationship model offers a unifying model of customer-brand relationships. To develop it further as a relevant consumer-psychology model, future research should examine three key factors: how brand perception differs from person perceptions; what role brand experiences play as determinants of customer-brand relationships, and how the AA Relationship model fits with other brand frameworks. The author offers insights and suggestions on how to address these three tasks.
It is often asserted that a flexible exchange rate regime would facilitate current account adjustment. Using data on over 170 countries over the 1971–2005 period, we examine this assertion systematically. We find no strong, robust, or monotonic relationship between exchange rate regime flexibility and the rate of current account reversion, even after accounting for the degree of economic development and trade and capital account openness. This finding presents a challenge to the Friedman (1953) hypothesis and a popular policy recommendation by international financial institutions.
Should advertising be approached differently in emerging than in developed markets? Using data from 256 TV commercial tests conducted by a multinational FMCG company in 23 countries, we consider two routes of persuasion: a functional route, which emphasizes the features and benefits of a product, and an experiential route, which evokes sensations, feelings, and imaginations. Whereas in developed markets the experiential route mostly drives persuasion, the functional route is a relatively more important driver in emerging markets.
A common cliché and system-justifying stereotype is that power leads to misery and self-alienation. Drawing on the power and authenticity literatures, however, we predicted the opposite relationship. Because power increases the correspondence between internal states and behavior, we hypothesized that power enhances subjective well-being (SWB) by leading people to feel more authentic.
This paper provides a theoretical analysis of the efficiency of prepayment penalties in a dynamic competitive lending model with risky borrowers and costly default. When considering improvements in the borrower's creditworthiness as one of the reasons for refinancing mortgages, we show that refinancing penalties can be welfare improving, and that they can be particularly beneficial to riskier borrowers in the form of lower mortgage rates, reduced defaults, and increased availability of credit.
In this paper, we develop an account of the failure of private market-governance institutions to maintain market order by highlighting how control of their distributional function by powerful elites limits their regulatory capacity. We examine the New York Clearing House Association (NYCHA), a private market-governance institution among commercial banks in Manhattan that operated from 1853 to 1913.
We consider price competition models for oligopolistic markets, in which a significant part of the product or service price is paid by a third party, as a subsidy. The consumer is, therefore, impacted by the net price, defined as the difference between the nominal price and the subsidy, while the firms earn the full nominal price, partially paid by the subsidizing third party and the remainder by the consumer.
A high quality customer database is a cornerstone of successful interactive marketing strategies and tactics. Based on the notion that customer data quality is not only a technical but also an organizational problem, this study develops and tests an organizational learning framework of the relationship between organizational processes, customer data quality and firm performance. The findings show that high quality customer data impact both customer and business performance and that the most important driver of customer data quality comes from the executive suite.
Negative social feedback is often a source of distress. However, self-verification theory provides the counterintuitive explanation that negative feedback leads to less distress when it is consistent with chronic self-views. Drawing from this work, the present study examined the impact of receiving self-verifying feedback on outcomes largely neglected in prior research: implicit responses (i.e., physiological reactivity, facial expressions) that are difficult to consciously regulate and downstream behavioral outcomes.
It is often claimed that we live in an information age. This has many implications for decision makers in general and business leaders in particular. For most businesses nowadays, increasingly, it is superior information that is at the origin of competitive advantage. The prime challenge in this new environment does not start with data analysis. Rather, the most important issue for the firm is to understand its information needs: what information, if it were available, would make a real difference for value creation and competitive advantage?
Motivated by recent empirical work, this paper formalizes a theory of competitive savings — an arms race in household savings for mating competition that is made more fierce by an increase in the male-to-female ratio in the pre-marital cohort. Relative to the empirical work, the theory can clarify a number of important questions: What determines the strength of the savings response by males (or households with a son)? Can women (or households with a daughter) dis-save? What are the conditions under which aggregate savings would go up in response to a higher sex ratio?
The financial crisis that erupted in late 2007 has resurfaced debates about the role of accounting and external financial reporting by financial institutions in helping detect or mask systemic risks and in exacerbating or mitigating such risks. The debate has largely focused on the role of fair value accounting, securitization and special purpose entities, off-balance sheet reporting and pro-cyclicality. We consider these and other issues using a single company's published accounts.
The financial crisis that erupted in late 2007 has resurfaced debates about the role of accounting and external financial reporting by financial institutions in helping detect or mask systemic risks and in exacerbating or mitigating such risks. The debate has largely focused on the role of fair value accounting, securitization and special purpose entities, off-balance sheet reporting and pro-cyclicality. We consider these and other issues using a single company's published accounts.
Social scientists have spent decades studying how individuals achieve status within organizational groups — that is, how they gain respect, prominence, and influence in the eyes of others. We know, for example, that demographics matter: People of the historically dominant race and gender and a respected age (white men over 40 in the western corporate world) are typically afforded higher status than everyone else.