(This guest post originally appeared at the author’s blog)
Regular readers of “A Dash” may be surprised to see that I have objections to the most recent payroll employment report results from the Bureau of Labor Statistics. Ironically, my objections come at a time when many critics say it is a “clean” report. In addition, I think that the problem relates to the measurement of job creation.
Some Background
I hope that I have established some credibility on this subject. The BLS has a method for estimating the monthly job change, including job creation. For several years I have insisted that the right way to keep score was to look at the final results, which we eventually know from state employment data, and test the estimates against those results.
Until recently, the results were excellent.
Something happened. It did not happen at the onset of the recession, as many critics predicted. In fact, the BLS method had worked through the 2001 recession, something that everyone ignored.
It did not even happen in Q408, at least not very dramatically. The problem showed up in Q109, as I reported and discussed (here) and in my November preview.
Let’s repeat my recent review of the BLS method for estimating job creation. If you take a moment to read this carefully, you will see why the critics were wrong before, and are also missing the problem now.
How the BLS Handles Job Creation
The BLS approach is to make an estimate of the total payroll jobs in one month, make another estimate for the next month, and subtract the two to determine the change. They use an excellent and sophisticated survey technique to do this. Their historical record, judged by the eventual count from the states, has been very good — until quite recently.
The Survey Problem. Any time you do a survey, there will be non-respondents. When the question is something like “How many people favor health care with a public option?” the non-respondent problem takes a simple form. You need only ask whether the non-respondents are similar to those who actually answered. Most polls make this assumption.
The employment question is qualitatively different. We are not asking the opinions of non-respondents. We are asking whether they are even still in business. If the BLS were to assume that non-respondents had all ceased operations, they would seriously underestimate total employment. Historical data conclusively show that the non-respondents are split between those who did not answer and those who are out of business. The data also show that new job creation, running at about 2 million jobs per month even in recessions, are a predictable function of dying businesses.
Let me emphasize the difficulty. There are always non-respondents to the voluntary survey, despite the best efforts to get everyone. If the BLS assumed that the non respondents were all lost jobs, and that the impact was proportional, we would see a loss of 13 million jobs per month, a silly result. Instead they attempt to impute business deaths and births. At one point, they assumed a business birth for every death. This is the natural result from extrapolating the sample to the entire population.
This is not the +/- 100K jobs from sampling error; it is non-sampling error. This means that the non-respondents are different in an important way from those who answer the survey. We know this to be true, so the problem is how to compensate.
The Job Creation Estimation. Because of this, the BLS employs a two-step process. The imputation step forecasts job creation from job destruction, and includes a cyclical component.. The Birth/Death adjustment, (the only thing cited by most critics, who ignore the more important imputation step), is a residual. For many years this residual was stable. The most recent test against the state data indicated a significant error, showing that the BLS estimates have been wrong for nearly a year, especially since Q1 09.
The Result
The preliminary benchmark revisions show that as of March, 2009, the number of jobs was over-estimated by 824K jobs. When the official revisions are announced in February, for the January report, there will be three important effects:
Two years ago I asked BLS experts if the Birth/Death adjustment could ever be a negative number. The answer was that while it was theoretically possible, it had never occurred in the recession periods during the development of the model. It is possible that this adjustment will now become neutral or negative, assuming that the BLS maintains the current methodology.
Conclusions
There are several key conclusions.
There was a general sense of surprise at the November results, but no one has a clear concept of what went wrong. TrimTabs has entered an objection, and I agree. The estimates of job change from our model, and the other approaches that I report each month (including TrimTabs), will prove to be better estimates than recent BLS reports.
It will take some months before we see the actual data to prove this, but I intend to follow up with some estimates. Meanwhile, I doubt that employment has improved as much as the current report indicates. It is not consistent with other economic data.
And finally, readers should note that this had nothing to do with BLS bias, manipulating the numbers, or creating “phantom jobs” on demand for President Obama. It is all about methodology, and the inherent limitations on the survey approach. The BLS team devised a good approach and implemented it in consistent fashion. The change in the credit markets – not a normal recession — seems to have undermined their empirical models.
I am reporting about data. My conclusions are based completely upon where the data leads me. For many years, the BLS method worked extremely well. We should now use a variety of methods to assess job changes.
I have a continuing concern about concurrent seasonal adjustment. More to come….
Join the conversation about this story »
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Guy Fieri is one of those people that you either love, or hate (while secretly loving). He’s been touring round the country like a rock star with his Road Show and we managed to catch last nights gig in Kansas City. It was a serious party, but we still walked away with a few tips that you can put to use in your own kitchen!
Yesterday I participated in a press conference with U.S. Commerce Secretary Gary Locke and Secretary of Energy Steven Chu to unveil an exciting new initiative that will drive innovation in the green technology sector, increase U.S. competitiveness in green technology, and create green jobs. The USPTO initiative, which launches today as the world looks to the United Nations Climate Change Conference in Copenhagen, Denmark, is a pilot program designed to reduce the average processing time of green technology patent applications.
Through this program, applications already on file in certain green technology areas will be eligible to be accorded special status and examined on an accelerated basis. To be eligible, applicants must file a no-cost petition for special status and indicate how the invention materially contributes to environmental quality, the discovery or development of renewable energy resources, more efficient utilization and conservation of energy resources, or greenhouse gas emission reduction. The pilot will be open to the first 3,000 applications for which a proper petition is filed. If successful, the program may be expanded down the road.
You can read more about the program in this press release and in my remarks from the press conference, as well as press accounts of the announcement including NYTimes.com and WSJ.com.
We will monitor the program carefully and will share updates with you along the way. And, of course, we welcome your comments and feedback.
Filed under: Porsche, Volkswagen
Cue Ennio Morricone and the symphonic accompaniment to the endgame: VW has officially taken a 49.9% stake in Porsche. VW paid €3.9 billion ($5.75B U.S.) for its cut, “based on the enterprise value for Porsche AG calculated under a careful due diligence and valuation procedure.” That’s a few shades more than the €3.3 billion amount VW was saying it would pay a few months ago.
In acquiring Porsche, VW not only gains a premium brand that is still among the most profitable in the business, but VW expects its operating profit to jump by €700 million ($1.03B U.S.) over time due to cost-saving synergies. The purchase won’t be finalized until 2011, though, when VW will incorporate Porsche Holding Salzburg, Europe’s largest car dealer which also happens to be owned by Porsche.
You can read VW’s press release – which has an air of something from Napoleon’s PR department after the Battle of Austerlitz – after the jump.
[Source: Volkswagen]
Continue reading Volkswagen takes 49.9 percent stake in Porsche AG
Volkswagen takes 49.9 percent stake in Porsche AG originally appeared on Autoblog on Tue, 08 Dec 2009 09:32:00 EST. Please see our terms for use of feeds.
The Christmas Laptop Sales 2009 are out from all major department and specialty stores. The savings from the Black Friday Deals can now even be better.
From Best Buy, the new Dell Inspiron Laptop with an Intel Pentium Dual-core processor, 3 GB memory, 6 cell lithium-ion battery DVD+RW/CD –RW drive, 250 GB hard drive, 14” wide screen, built-in web cam, and the new Windows 7 Home Premium edition operating system. This unit is going for $449.99. To help personalize this laptop, it is available in three different colors of Pink, Jade Green, or Ice Blue.
For those that prefer a Gateway Computer there is the model NV5212u with a AMD Athlon X2 dual-Core processor with a 4GB memory, 320 GB hard drive with a DVD-RW/CD-RW drive 6 cell lithium-ion battery, built in web cam, a 15.6” wide screen, and the new Windows 7 Home Premium edition operating system. This piece is going for $399.99. There is only one color choice of Cherry Red with this model that is available at this time.
From Walmart comes a Christmas sale on laptop also. The list includes the low prices on eMachines 15.6” eME627-5279 laptop PC with AMD Athlon 64 processor which is 1.6GHZ. The memory is 2GB with a 160 GB hard drive, 15.6” LCD wide screen along with a Wi-Fi and card reader, a DVD-RW/CD drive with a 6 cell battery that can last up to 2.5 hours, and the new Windows 7 Home Premium edition operating system. This sells for $368.00.
These are just a few of the great Christmas Laptop Sales 2009 that are available today.
RAINN (Rape, Abuse & Incest National Network), the nation’s largest anti-sexual assault organization, is seeking volunteers in the Baltimore area to assist sexual assault survivors on the National Sexual Assault Online Hotline.
The Online Hotline provides live, secure and anonymous help to the growing number of people who prefer communicating via the Internet. Volunteer on your home computer for only 8 hours per month. Make your time online count and help give hope.
For more information on volunteering, or to register for the February 20th-21st volunteer training session in Baltimore, please visit: http://apps.rainn.org/VolApp/
KNOXVILLE — The number of teachers in Tennessee public school systems will not keep up with future demand, forcing school systems to look elsewhere, including out of state, to find teachers to educate the state’s growing population of school-age children.
That is the major finding in “Supply and Demand for Teachers in Tennessee,” a study released today by the Center for Business and Economic Research (CBER) at the University of Tennessee, Knoxville. The report’s authors at CBER were Director William Fox; Research Associate Professor Donald Bruce; Research Associates Brian M. Douglas and Melissa O. Reynolds; and Graduate Research Assistant Zhou Yang.
The study — which estimates the supply and demand of public school teachers from academic years 2009-2010 to 2013-2014 — was prepared to help local and state education officials hire and develop new teachers. The Tennessee Governor’s Office funded the study, and the Department of Education and the Tennessee Higher Education Commission (THEC) participated in the development of the report.
“Understanding future teacher supply and demand is a cross-cutting issue with implications for school districts, colleges and universities,” said Richard Rhoda, THEC executive director. “That is why it was appropriate that this study involved several agencies contributing resources to address a complex problem based on data. Since education is such an interconnected enterprise, we will need more of these collaborations as we go forward.”
According to the CBER study, the state will need as many as 69,168 teachers, pre-K through 12th grade, in the 2010-2011 school year, but will have only 57,665 teachers on the payroll because of expected teacher departures and growth in the required number of teachers. That will leave as many as 11,503 positions to be filled.
That gap will only grow over time, according to CBER estimates. By the 2013-2014 school year, the state will need to fill a cumulative 31,431 teacher positions, or about 40 percent of total teachers.
To fill the gaps, school systems will have to recruit college graduates and experienced teachers from other states, and look for people transitioning from other careers to become teachers. In some cases, Fox said, teachers may have to teach technical subjects for which they aren’t specifically trained.
Fox said the study helps to illustrate what must be done to meet the demands being placed on schools today.
“We’ve been changing the rules,” Fox said. “For instance, we’ve increased the number of math classes and sciences classes that students must take. We’ve lowered pupil-to-teacher ratios.
“What has never happened in Tennessee is someone sitting down and saying, ‘What are the implications of the policies we’re legislating?’ We have to begin to assess our capacity to provide the quality of education that we’re mandating, based on the traditional routes of finding teachers.”
Education Commissioner Tim Webb echoed that: “This study provides critical information as the state seeks to improve teacher effectiveness and implement the Tennessee Diploma Project.”
The Tennessee Diploma Project, which began this academic year, is a broad overhaul of standards and curriculum designed to challenge students and better prepare them for college and the workforce. Students who began high school in fall 2009 saw increased graduation requirements, a focus on the skills needed for college and the workforce in an ever-expanding global economy, and new assessments.
“Expanding all types of teacher preparation programs and teacher recruitment efforts is clearly going to be required to meet this demand,” Webb said.
It’s more than just finding enough teachers, Fox added; it’s finding teachers sufficiently qualified to teach the more complex subjects, such as science and math.
“There’s a huge imbalance between the number of people we need and the number of people who are being trained to teach these really technical matters,” he said.
The CBER study provides supply-demand gap estimates for a variety of teacher categories. The gaps are estimated to be largest in percentage terms (relative to 2010 supply) for teachers certified to teach English as a Second Language (ESL); elementary school music, art and physical education; eighth grade; and vocational education. The smallest percentage gap is estimated for kindergarten teachers.
In making their supply-and-demand predictions, researchers estimated a 2 percent yearly growth rate in the number of school-age children in Tennessee. They took into account the percentage of teachers who stay in their jobs from year to year, the percentage of teachers who move between school districts each year, the number of newly graduated teachers who enter the market each year and the number of former teachers who return to teaching each year.
Fox said his hope is that the report prompts colleges and universities to look for ways to increase the number of teachers they turn out, especially in high-demand subject areas.
The good news, Fox said, is that this report comes on the heels of two efforts being launched at UT Knoxville to help ease teacher shortages.
UT is partnering with the Public Education Foundation of Chattanooga, Knox County Schools and the Hamilton County Department of Education to create a new teacher residency program called Teach/Here. The program will recruit college graduates and career-changers with backgrounds in science, technology, engineering and math.
Also, it recently was announced that UT will receive as much as $1.8 million from the state of Tennessee to launch VolsTeach, a new program to improve the quantity and quality of mathematics and science teachers.
To read the CBER report visit http://cber.utk.edu.
—
C O N T A C T :
Bill Fox, CBER (865-974-6112, [email protected].)
David Wright, THEC (615-532-3862, [email protected])
Karen Collins, UT (865-974-5186, [email protected])
RAINN (Rape, Abuse & Incest National Network), the nation’s largest anti-sexual assault organization, is seeking volunteers in the D.C. area to assist sexual assault survivors and their friends and family on the National Sexual Assault Online Hotline.
The Online Hotline provides live, secure and anonymous help to the growing number of people who prefer communicating via the Internet. Volunteer on your home computer for only 8 hours per month. Make your time online count and help give hope.
For more information on volunteering, or to register for the January 23rd-24th volunteer training session in DC, please visit: http://apps.rainn.org/VolApp/
On November 17, a video from a crash involving a police car in Connecticut was released to the public. The video shows the last moments in the lives of two young people in a car hit by a police cruiser moving 94 miles per hour with no siren and no flashing lights. It was carried on local news broadcasts and quickly circulated on the Internet. If we didn’t have this critical footage, there would be no contemporaneous visual record of the events immediately preceding the accident. But what will jurors and judges make of this ostensibly objective and probative visual evidence?
My research and teaching focuses on visual persuasion — the use of images to communicate and create their own meaning in legal settings. Together with Neal Feigenson, I recently published a book on the topic, entitled “Law on Display.” The case in Connecticut provides a striking example of the potential power of visual evidence in a criminal case, and the many ways seemingly simple images can be interpreted and presented in a courtroom.
To test the public response to the video, I paged through reader comments in a New Haven Register story featuring the video.
Those who blame the officers outnumber those who blame the young people three to one. Some responders want to split the blame; others advise waiting for the evidence to be tested in court. A few speculate about what might be discerned from the tape about the driver of the cruiser that collided with the turning car– that he must have been looking back through his mirror, not forward, to have missed seeing the car. Many comments express the writers’ common sense presumptions about the behavior of those involved – teenagers drinking, teenagers out late at night buying cigarettes, cops “drag racing,” cops “abusing their power” by not obeying traffic laws themselves.
Impact Alabama is the state’s first nonprofit organization dedicated to developing and implementing substantive service-learning projects in coordination with universities and colleges throughout the state. Impact has two primary objectives: 1) to engage students in addressing human and community needs within structured service opportunities intentionally designed to promote student learning and leadership development; 2) to enhance students’ sense of social and political responsibility, as well as their sense of ability to affect systemic change. Impact has three “signature initiatives” that focus on vision screening/follow-up care, financial literacy/tax assistance, and academic enrichment for low-income youth.
Impact Alabama Regional Coordinator
Job description
Individuals who work with Impact Alabama spend a year of service after graduation at a unique, nationally recognized organization fighting poverty in Alabama. Impact seeks highly motivated, talented graduates to fill full-time staff positions that implement and oversee three nationally unique initiatives based upon a collaboration with twenty colleges across the state of Alabama: FocusFirst, SaveFirst, and CollegeFirst. FocusFirst trains college students to provide high-tech vision screenings and follow-up care to preschool-age children in Head Starts and day cares in low-income rural and urban areas throughout Alabama. SaveFirst trains college students to provide free tax preparation services and opportunities for economic improvement to working families in Alabama. CollegeFirst trains college and graduate students to provide academic tutoring and mentoring to high school students pursuing Advanced Placement coursework and help implement a Pre-AP summer academic enrichment program for rising ninth graders.
Skills required
Successful candidates will exhibit a commitment to improving the lives of economically disadvantaged families in Alabama; a record of community service and/or civic engagement; demonstrated student leadership; the ability to work well with a diverse group of individuals, including college students, children, the elderly, working families, and community-based partners; the ability to multi-task; and a positive attitude.
This full-time position combines service with FocusFirst, SaveFirst, and CollegeFirst. Each initiative will allow you to work directly on college campuses and in communities statewide. When you work with FocusFirst, you will (1) coordinate the expansion of FocusFirst to reach a greater number of children statewide; (2) organize and plan training seminars for students at participating campuses; (3) lead trained students to screen low-income, preschool children for vision problems. When you work with SaveFirst, you will (1) work with campuses and community partners to establish the initiative as a service-learning opportunity at campuses across Alabama; (2) recruit and train college students to prepare taxes and manage their service at community-based tax preparation sites. When you work with CollegeFirst, you will (1) coordinate tutoring and mentoring services provided by college students, especially those proficient in math and science; (2) provide in-classroom support to AP teachers during prep sessions; (3) develop curriculum for and coordinate summer academic enrichment program for rising ninth graders.
Start Date: July 2010
End Date: July 2011
Application Instructions: Please send a resume and an unofficial academic transcript to sblack {at} impactalabama(.)org.
Contact Information:
Stephen F. Black, President
1901 6th Ave N Suite 2400
Birmingham, AL 35203
Phone: (205) 934-0664
Fax: (205) 934-0271
Email: sblack {at} impactalabama(.)org
Craigslist and eBay are set to fight it out in the court room as a trial between the two companies gets underway in Delaware, US. eBay has filed a lawsuit against Craigslist in 2008 as the two companies argue about eBay’s share in the classifieds site. The auctions site claims that Craigslist diluted its stake by issuing new shares, lowering eBay’s slice from 28.4 percent to just 24.85 percent which meant loosing its seat on the Craigslist board.
Former eBay CEO Meg Whitman took the stand yesterday in the first day of the trial which is set to last a week. She argued eBay’s case saying the company entered with the best intentions and was deeply interested in the classifieds market. eBay bought its stake in Craigslist from a former investor and Whitman says the company paid $16 million for the shares and a further $8 million to Craigslist cofounder Craig Newmark and to CEO Jim Buckmaster for special rights, like veto powers over mergers and acquisitions, as the company wanted to make sure competitors didn’t get their hands on it.
“We were very interested in making an acquisition of Craigslist and we would have loved to have bought the whole thing,” Whitman told the court. “But we understood early on that was not going to be possible, at least early on.” She also said that the company was interested in the … (read more)
Kathy added a few touches to the Pax wardrobe to create this warm, woody closet. If I didn’t know better, I’ll think it’s a spa and stretch out for a massage.
“I found your web site quite by accident and felt I had located long lost relatives I never knew existed. I have been hacking Ikea items for years but never knew the practice had a name (or a following). Here are photos of just one of my favorite projects. This is my master bedroom closet that I outfitted entirely in Ikea pieces (mostly Pax wardrobes but also drawer units that I’ve forgotten the name of and the ever-popular Expedit. (I worship at the altar of Expedit.)
I started with plain, birch wardrobe doors and embellished them with 4 elements:
– brown and black toile wrapping paper
– expanded metal that I custom-painted with hammered bronze spray paint
– wood trim that I also painted with hammered bronze spray paint
– and finally, door handles made from curtain rods screwed in sideways
I also mounted a Christmas wreath around the main light and wired it to a remote control switch. I use it for ambient lighting.
It is my favorite room in the house, even though it’s only a closet. Enjoy!”
With holiday season parties in sight, it’s nice to have easy appetizers you can count on. That’s what we had in mind when we ran our holiday appetizer contest last week, and today we’re sharing one of the winners.
Michelle
T. sent us this classy and easy appetizer idea. We loved the
contrast of flavors and textures: creamy goat cheese with crisp arugula, and sweet figs with salty
prosciutto. It’s an easy appetizer you can make ahead and keep in the fridge until show time.
Figs and prosciutto are a classic Italian flavor combination, fit for any celebration. For a warm version, bake figs stuffed with goat cheese or gorgonzola cheese and wrapped in prosciutto. Or use them as toppings on a gourmet pizza.
So whether you’re hosting holiday get-togethers or bringing a dish to a potluck, you can impress guests with delicious and easy appetizers that take only minutes to prepare. To see other recipe winners in our holiday appetizer contest, click here for our December newsletter.
Fig & Prosciutto Roll-Ups
Prep time: 15 minutes (not counting 1 hr refrigeration time afterward)
Serves: 8
We’ve covered how various companies in Europe have built up an extremely profitable business by purposely seeding content they have the rights to on file sharing networks, and then sending “pre-settlement” letters demanding money from the holder of any IP address that connects to them, even if the IP address is not accurately indicating who was involved. They’re now sending out these letters at a massive rate, and while they’re not actually filing lawsuits, it appears that at least one of the firms involved, DigiProtect, is getting a collections agency involved in some cases. That seems pretty nasty. There’s no actual debt here, because the person has not agreed to pay up, but by handing it over to a collections agency, the person will now get hounded with demands for payment. It’s difficult to see how this is even close to legal.
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Kinda like how third-party peripheral companies went gaga over the Wii’s waggle wand, it seems Sony has patented an large number of possible attachments for their upcoming motion controller. From something that looks like dual maracas to
Integrity and identity are the topics of two different working papers this week. Integrity, says HBS professor emeritus Michael C. Jensen, means “a state or condition of being whole, complete, unbroken, unimpaired, sound, in perfect condition.” It does not mean being perfect. As his working paper suggests, integrity assumes that people keep their word. Yet individuals retain their integrity even when they fail to keep a promise—so long as they acknowledge the consequences created by their lapse and try to make amends. Jensen’s remarks originally appeared as an interview in Rotman Magazine of the Rotman School of Management.
As Jensen says, “If I had one recommendation for improvement to the curriculum of every business school, it would be to make it very clear to students that cost-benefit analysis is very important almost everywhere in life—but not with respect to honoring one’s word. In my view, this is a major root cause of the current economic crisis.”
Identity, meanwhile, is also important to people and organizations. HBS postdoctoral fellow Lakshmi Ramarajan, author of the working paper “Opening Up or Shutting Down? The Effects of Multiple Identities on Problem Solving,” discusses issues of identity and workplace boundaries.
As Ramarajan writes, “An employee in a multinational corporation may think of himself not only as a member of the corporation, but also as an alumnus of his university, a citizen of his home country, a manager, a team member, a parent, an accountant, and a musician. With a similar proliferation of identities within each person, new questions arise regarding the influence of a person’s identities on how she engages in resolving problems with others. Do multiple intrapersonal identities help or hinder how people resolve problems with others?” Her paper offers insights and suggestions for alleviating tensions.
— Martha Lagace
| Authors: | Carliss Y. Baldwin and Eric von Hippel |
|---|
In this paper we assess the economic viability of innovation by producers relative to two increasingly important alternative models: innovations by single user individuals or firms and open collaborative innovation projects. We analyze the design costs and architectures and communication costs associated with each model. We conclude that innovation by individual users and also open collaborative innovation increasingly compete with—and may displace—producer innovation in many parts of the economy. We argue that a transition from producer innovation to open single user and open collaborative innovation is desirable in terms of social welfare and so worthy of support by policymakers.
Download the paper: http://www.hbs.edu/research/pdf/10-038.pdf
| Authors: | Robert S. Huckman and Bradley R. Staats |
|---|
In many manufacturing and service settings, fluid teams of individuals with varied sets of experience are responsible for projects that are critical to their organization’s success. Although building teams from individuals with varied prior experience is increasingly necessary, prior work fails to find a consistent effect of variation in experience on performance. We hypothesize that team familiarity—team members’ prior experience working with one another—is one mechanism that helps teams leverage the benefits of variation in team experience by alleviating coordination problems that variation creates.
Download the paper: http://www.hbs.edu/research/pdf/09-145.pdf
| Authors: | Lakshmi Iyer and Anandi Mani |
|---|
We develop a framework to empirically examine how politicians with electoral pressures control bureaucrats with career concerns as well as the consequences for bureaucrats’ career investments. Unique micro-level data on Indian bureaucrats support our key predictions. Politicians use frequent reassignments (transfers) across posts of varying importance to control bureaucrats. High-skilled bureaucrats face less frequent political transfers and lower variability in the importance of their posts. We find evidence of two alternative paths to career success: officers of higher initial ability are more likely to invest in skill, but caste affinity to the politician’s party base also helps secure important positions.
Download the paper: http://www.hbs.edu/research/pdf/09-006.pdf
| Author: | Michael C. Jensen |
|---|
There is confusion between integrity, morality, and ethics. In our much longer paper on the topic (see “Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics and Legality”—available at http://ssrn.com/abstract=920625), my co-authors, Werner Erhard and Steve Zaffron, and I distinguish integrity from morality and ethics in the following way. Integrity in our model is honoring your word. As such, integrity is a purely positive phenomenon. It has nothing to do with good vs. bad, right vs. wrong behavior. Like the law of gravity the law of integrity just is, and if you violate the law of integrity as we define it, you get hurt just as if you try to violate the law of gravity with no safety device. The personal and organizational benefits of honoring one’s word are huge—both for individuals and for organizations—and generally unappreciated.
Download the paper: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1511274
| Author: | Lakshmi Ramarajan |
|---|
Across three studies, I investigate the distinct effects of multiple identity conflict and enhancement within people on two crucial aspects of resolving problems with others: integrative behavior and openness. The results of two studies support the hypotheses that multiple identity conflict is negatively related to integrative thinking, while multiple identity enhancement is positively related to attitudes of openness to others. In a third study, I conducted an interpersonal dyadic negotiation experiment with business school students and found that, as predicted, these effects replicated and extended to integrative outcomes and open behaviors. This research shows that there are both harmful and helpful effects of multiple identities on interpersonal problem solving depending on whether those identities are enhancing or conflicting: multiple identity conflict shuts down integrative thought and behavior and multiple identity enhancement opens us up to other people.
Download the paper: http://www.hbs.edu/research/pdf/10-041.pdf
| Authors: | Lara B. Aknin, Michael I. Norton, and Elizabeth W. Dunn |
|---|---|
| Publication: | Journal of Positive Psychology 4 (2009): 523-527 |
While numerous studies have documented the modest (though reliable) link between household income and well-being, we examined the accuracy of laypeople’s intuitions about this relationship by asking people from across the income spectrum to report their own happiness and to predict the happiness of others (Study 1) and themselves (Study 2) at different income levels. Data from two national surveys revealed that while laypeople’s predictions were relatively accurate at higher levels of income, they greatly overestimated the impact of income on life satisfaction at lower income levels, expecting low household income to be coupled with very low life satisfaction. Thus, people may work hard to maintain or increase their income in part because they overestimate the hedonic costs of earning low levels of income.
| Author: | Malcolm Baker |
|---|---|
| Publication: | Annual Review of Financial Economics 1, no. 1 (December 2009) |
Much of empirical corporate finance focuses on sources of the demand for various forms of capital, not the supply. Recently, this has changed. Supply effects of equity and credit markets can arise from a combination of three ingredients: investor tastes, limited intermediation, and corporate opportunism. Investor tastes, when combined with imperfectly competitive intermediaries, lead prices and interest rates to deviate from fundamental values. Opportunistic firms respond by issuing securities with high prices and investing the proceeds. A link between capital market prices and corporate finance can, in principle, come from either supply or demand. This framework helps to organize empirical approaches that more precisely identify and quantify supply effects through variation in one of these three ingredients. Taken as a whole, the evidence shows that shifting equity and credit market conditions play an important role in dictating corporate finance and investment.
| Author: | Bhaskar Chakravorti |
|---|---|
| Publication: | In India 2010. Business Standard Books, in press |
Entrepreneurship is frequently associated with a “small thing”—a venture that challenges the status quo and relentlessly pursues opportunity. The large established firms, the “gods,” have forever coveted these small things—through incubation, financial support, or acquisition—in their quest for the Next Big Thing. The problem with corporate entrepreneurship, of course, has been that the entrepreneur must deal with the challenges of securing resources and support within an organization focused on operations that are “at scale.” Entrepreneurs with miniscule, and often negative, financial contributions compete with mature businesses that are the primary revenue generators for the firm. Revenue is power, and for senior management taking their eyes off the mature businesses can be extremely costly. As a result, corporate entrepreneurship languishes despite its importance to the company’s future. I argue that there may be a geographic solution to this dilemma. In such a solution, a fast-growing emerging market plays a central role in orchestrating a complete strategy for corporate entrepreneurship. I also argue that it is time to go beyond the traditional framing of an emerging market. The prescription of this chapter is to think about a more ambitious role for such markets: establish a strategic business unit, designated as a “disruptive innovation hub,” that is charged with first penetrating the emerging market with products tailored to local needs and conditions and then leveraging that experience to develop disruptive innovations targeted at a global market. Scale and entrepreneurship—god and small things—can, indeed, cohabit and thrive in the developing world. This combination can become one of its major contributions to the global economy.
| Authors: | Quy-Toan Do and Lakshmi Iyer |
|---|---|
| Publication: | In Oxford Handbook of the Economics of Peace and Conflict, edited by Michelle Garfinkel and Stergios Skaperdas. Oxford University Press, forthcoming. (Also a Harvard Business School Working Paper, No. 10-040, November 2009.) |
We survey the recent literature on the mental health effects of conflict. We highlight the methodological challenges faced in this literature, which include the lack of validated mental health scales in a survey context, the difficulties in measuring individual exposure to conflict, and the issues related to making causal inferences from observed correlations. We illustrate how some of these issues can be overcome in a study of mental health in post-conflict Bosnia and Herzegovina. Mental health is measured using a clinically validated scale; conflict exposure is proxied by administrative data on war casualties instead of being self-reported. We find that there are no significant differences in overall mental health across areas that are affected by ethnic conflict to a greater or lesser degree.
Download the paper: http://www.hbs.edu/research/pdf/10-040.pdf
| Authors: | Jeffrey H. Dyer, Hal B. Gregersen, and Clayton M. Christensen |
|---|---|
| Publication: | Harvard Business Review 87, no. 12 (December 2009) |
An abstract is unavailable at this time.
Read an excerpt: http://hbr.harvardbusiness.org/2009/12/the-innovators-dna/ar/1
| Authors: | Benjamin Edelman |
|---|---|
| Publication: | HBR Now, HBR Voices (December 2009) |
The Internet is sold to advertisers as a highly measurable medium that is the most efficient way to target exactly the right customers. But online advertising is also easily subverted—letting fraudsters claim advertising fees for work they did not actually do. The trickiest frauds deceive advertisers so effectively that measurements of ad effectiveness report the fraudsters as exceptionally productive and high quality, rather than revealing that their traffic was actually worthless. This is a quiet scandal. In a time of tightening ad budgets, losses to advertising fraud come straight from the bottom line—but savings can be equally dramatic. Here’s a look behind the veil—an explanation of ad practices that have cheated even the Web’s largest advertisers. Advertising scams take plenty of victims, both witting and not, but I offer strategies to help determined marketers protect themselves.
Read the blog: http://blogs.harvardbusiness.org/hbr/hbr-now/2009/11/dark-underbelly-of-online-ads.html
| Author: | Benjamin Edelman |
|---|---|
| Publication: | Harvard Business Review 87, no. 12 (December 2009): 24 |
Online advertisers frequently fall victim to dishonest, tech-savvy publishers. Here’s a sampling of common scams with some advice on how to outwit their perpetrators.
Purchase the article: http://harvardbusiness.org/product/how-to-combat-online-ad-fraud/an/F0912D-PDF-ENG
| Author: | Elisabeth Köll |
|---|---|
| Publication: | In Manchurian Railways and the Opening of China: An International History, edited by Bruce A. Elleman and Stephen Kotkin, 123-148. New York: M.E. Sharpe, 2009 |
This chapter explores issues of how Chinese railroads improved social mobility and standards of living along major trunk lines, and how foreign investment shaped the integration of the Chinese railroad network from the early 1900s to 1949. As this case study of the Tianjin-Pukou line argues, the political context of semi-colonialism and imperialism in the first half of the 20th century framed the emergence and growth of railroad companies in China. This is not to say that individual railroad lines were not able to become substantial business institutions, but different political regimes—colonial authorities, warlords, political factions in the Republican government, and the Japanese—prevented the growth of Chinese railroads into an expansive, strong national railway network during the first half of the 20th century.
Purchase the book: http://www.mesharpe.com/mall/resultsa.asp?Title=Manchurian+Railways+and+the+Opening+of+China%3A+An+International+History
| Authors: | Jeffrey Polzer, Ranjay Gulati, Rakesh Khurana, and Michael Tushman |
|---|---|
| Publication: | Journal of Management Inquiry (forthcoming) |
In this volume, Palmer et al. and Miller et al. take different approaches to assessing the relevance debate in organizational studies. After commenting on these papers, we recommend that a “full-cycle” approach to conducting research can help organizational scholars increase the relevance of their work. We then describe how key elements of this approach can be incorporated into Organizational Behavior doctoral programs to help students produce research that is both rigorous and relevant. This approach can help faculty and doctoral students alike take advantage of our field’s position at the intersection of the social science disciplines, other business school constituents, and the organizational world of practice.
| Author: | Guhan Subramanian |
|---|---|
| Publication: | Harvard Business Review 87, no. 12 (December 2009) |
An abstract is unavailable at this time.
Read an excerpt: http://hbr.harvardbusiness.org/2009/12/negotiation-auction-a-deal-makers-guide/ar/1
Filed under: Aftermarket, Technology, Ford, Lincoln, Mercury
Good news, Ford fans: The Blue Oval will be adding remote start and heated steering wheels to its line of cars and trucks. The remote start option will make its first appearance on the 2011 F-Series Super Duty pickup truck while the heated tiller will initially be fitted to the 2011 Lincoln MKX.
Following those two launches, the automaker promises that both items will infiltrate the rest of its Ford, Lincoln and Mercury lineups in a jiffy. While it’s been possible to have an aftermarket remote start system installed on any new car or truck for quite some time (including a dealer-installed option from Ford), JD Power reports that 90 percent of all purchasers would prefer a factory option, which makes perfect sense to us, particularly since Ford’s system will be integrated with the heating and cooling systems to bring the cabin to a comfortable temperature regardless of the weather outside.
Ford predicts that the remote start system will help the vehicle’s exhaust catalyst heat up more quickly, thereby reducing hydrocarbon, carbon monoxide and nitrogen oxide emissions by up to 75 percent. Further, the automaker suggests that a heated steering wheel will increase dexterity in the fingers and hands and reduce the need to wear gloves while driving in the winter. Want to know more? Use those nice and toasty digits to hit the jump for the press release.
[Source: Ford]
Continue reading New features from Ford: Remote start and heated steering wheel
New features from Ford: Remote start and heated steering wheel originally appeared on Autoblog on Tue, 08 Dec 2009 08:57:00 EST. Please see our terms for use of feeds.
Perception is reality.
So it doesn’t matter what really happened when pay czar Kenneth Feinberg agreed to exempt a bunch of AIG executives from pay caps because they whined and threatened to quit over them.
This decision just looks like yet another wimpy, lame move from a government whose policies with respect to Wall Street have defined wimpy and lame.
Ever since the waning years of the Bush administration, when Washington “service” became just another rung on the Wall Street career ladder, our government has gone out of its way to protect the interests of its once and future employer.
And now, on the heels of outrage about record Wall Street bonuses in the face of 10% unemployment, Obama’s vaunted pay czar, Kenneth Feinberg, has revealed himself to be nothing more than a puppet:
WE’RE GOING TO CAP YOUR OUTRAGEOUS PAY!!! WE’RE GOING TO MAKE SURE YOU DON’T USE TAXPAYER BAILOUT MONEY TO PAY YOURSELVES HUGE BONUSES!!!*
*Unless you complain, in which case we’ll just forget the whole thing.
Is there another side to the story? Of course there is. Feinberg is in an impossible position, because pay caps were always a terrible idea. The US taxpayers now own AIG, so destroying it in the name of retribution for past sins would be just shooting ourselves in the foot. And when your firm value depends on your good people staying, you destroy the firm by making them leave.
But Feinberg’s predicament just reveals the insanity of our whole Too Big To Fail bailout policy, for which Bush, Paulson, Geithner, Bernanke, Summers, and Obama are directly responsible.
Too Big To Fail was a bad idea at the time–another short-term emergency fix for a country that has gotten addicted to them–and President Obama wasn’t the one who started it. But if he doesn’t find a way to appear as though he can stop the madness and stand up to Wall Street, it will be the end of him.
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