Columbia Business School Research

This cross-cultural study examined television advertising appeals (functional versus experiential and local versus global appeals) and their relationship with brand knowledge core components (brand awareness, brand attitude, and brand uniqueness) across countries at different levels of economic development. A dataset of 257 television commercials from 23 countries was used in the analysis. The researchers found that the experiential (emotional) appeal had a stronger relationship with the components of brand knowledge in countries with medium and high gross domestic product (GDP).

What kinds of credit substitution, if any, occur when changes to banks' minimum capital requirements induce them to change their willingness to supply credit? The question is of first-order importance given the emergence of "macro-prudential" policy regimes in the wake of the global financial crisis, under which regulatory tools — in particular, minimum capital ratio requirements for banks — will be employed to control the supply of bank credit as part of the effort to improve the resilience of the financial system.

We propose an approach for using individual-level data on social interactions (e.g., number of recommendations received by consumers, number of recommendations given by adopters, number of social ties) to improve the aggregate penetration forecasts made by extant diffusion models. We capture social interactions through an individual-level hazard rate in such a way that the resulting aggregate penetration process is available in closed form and nests extant diffusion models.

The seminal work by Grossmann and Hart (1986) made the study of firm boundaries susceptible to formal economic analysis, and illuminated an important role for markets in providing incentives. In this essay, I discuss some new directions that the literature has taken since. As a central challenge, I identify the need to provide a formal theory of the firm in which managerial direction and bureaucratic decision-making play a key role. Merging a number of existing incomplete contracting models, I propose two approaches with very different contracting assumptions.

With globalization, cross-cultural competence is increasingly important to effective policies in international relations, business, and even in our schools and communities. Can we assess the skills and attributes relevant to gaining proficiency in other cultures? What kinds of training can help people toward this goal? Evidence on the assessment question comes from surveys of immigrant acculturation and expatriate adjustment, investigating antecedents including personality, general intelligence (g), and social-cultural intelligence.

This special section is the result of an effort by several scholars to move marketing academic research toward greater practical relevance. This initiative, called Theory Practice in Marketing (TPM), started with a conference at Columbia Business School in 2011, and the five papers published in this special section were presented at the second TPM conference held at Harvard Business School in 2012.

We examine (1) whether the accounting, governance, and investing practices of Berkshire Hathaway investees are consistent with Warren Buffett's public statements on what constitutes good accounting, governance, and investing practices and (2) whether these practices are associated with Berkshire's initial "selection" or Buffett's subsequent "influence." Compared to control firms, we find that Berkshire investees are highly likely to follow Buffett's investment philosophy, somewhat likely to follow his preferred accounting, disclosure, and compensation policies, but unlikely to follow the bo

The case describes the launch of a social media platform by the largest container shipping company in the world. Students will have the opportunity to thoroughly evaluate the campaign, which by observable criteria, has done extremely well. The case provides details on the various platforms used, the nature of content provided on each, and the associated budgets (including headcount). The budget figures are particularly interesting because they permit a rich discussion around the social media program's ROI.

Conventionally, the construction of a pair-matched sample selects treated and control units and pairs them in a single step with a view to balancing observed covariates x and reducing the heterogeneity or dispersion of treated-minus-control response differences, Y. In contrast, the method of cardinality matching developed here first selects the maximum number of units subject to covariate balance constraints and, with a balanced sample for x in hand, then separately pairs the units to minimize heterogeneity in Y.

The value of a business depends on its future not its past. Nonetheless, some managers base key decisions on backwards-looking metrics or models that have been shown to be inappropriate in many situations.

What metrics and models can provide managers with steering control for maximizing the value of their business? This editorial provides some ideas.

There are obvious economic predictors of ability and willingness to invest in environmental sustainability. Yet, given that environmental decisions represent trade-offs between present sacrifices and uncertain future benefits, psychological factors may also play a role in country-level environmental behavior. Gott's principle suggests that citizens may use perceptions of their country's age to predict its future continuation, with longer pasts predicting longer futures.

Although a great deal of research has examined specific behaviors that positively affect leaders' negotiation processes and outcomes, there has been considerably less attention devoted to stable characteristics, psychological or physical, that might also influence outcomes at the bargaining table. In the current research, we identify a measureable physical trait — the facial width-to-height ratio — that predicts negotiation performance in men.

Aggregation, and minimizing associated information loss, is a pervasive theme in accounting. In contrast, this paper highlights some potential benefits of aggregation, using simple examples to illustrate ideas from a number of recent papers in a parsimonious manner. Aggregation rules can improve decision making because of their ability to convey appropriate information and because such rules may permit offsetting errors. Turning to control problems, aggregation has merit in the provision of both explicit and implicit incentives.

Public opinion polls reveal that the perception of climate change as an uncertain phenomenon is increasing, even as consensus has increased within the scientific community of its reality and its attribution to human causes. At the same time, the scientific community has sought to improve its communication practices, in order to present a more accurate picture to the public and policy makers of the state of scientific knowledge about climate change. In this review article, we examine two sets of insights that could influence the success of such communication efforts.

In this article, we review empirical research investigating the efficacy of perspective-taking — the active consideration of others' mental states and subjective experiences — as a strategy for navigating intergroup environments. We begin by describing some of the benefits accrued from perspective-taking: more favorable implicit and explicit intergroup evaluations, stronger approach-oriented action tendencies and positive non-verbal behaviors, increased intergroup helping, reduced reliance on stereotype-maintaining mental processes, and heightened recognition of intergroup disparities.

We introduce a new, market-based and forward looking measure of political risk derived from the yield spread between a country?s U.S. dollar debt and an equivalent U.S. Treasury bond. We explain the variation in these sovereign spreads with four factors: global economic conditions, country-specific economic factors, liquidity of the country?s bond, and political risk. We then extract the part of the sovereign spread that is due to political risk, making use of political risk ratings.

A recent surge of research has investigated the potential of pro-environmental behavior interventions to affect other pro-environmental behaviors not initially targeted by the intervention. The evidence evaluating these spillover effects has been mixed, with some studies finding evidence for positive spillover (i.e., one pro-environmental behavior increases the likelihood of performing additional pro-environmental behaviors) and others finding negative spillover (i.e., one pro-environmental behavior decreases the likelihood of additional pro-environmental behaviors).

Do people know when they are seen as pressing too hard, yielding too readily, or having the right touch? And does awareness matter? We examined these questions in four studies. Study 1 used dyadic negotiations to reveal a modest link between targets' self-views and counterparts' views of targets' assertiveness, showing that those seen as under- and over-assertive were likely to see themselves as appropriately assertive.

A growing literature investigates the association between stock return variation and several aspects of information and governance structures, both in cross-country settings and cross-firm settings within the U.S. Several papers in this literature use idiosyncratic stock return volatility (s_e^2) as the measure of firm-specific return variation whereas others use return synchronicity, or R2.

How do firms repair their reputations after a serious accounting restatement? To answer this question, we review firms' press releases and identify 1,765 reputation-building actions taken by: (1) 94 restating firms in the periods before and after their restatement; and (2) a set of matched control firms during contemporaneous periods.

This research examines how consumers choose retailers when they are uncertain about store prices prior to shopping. Simulating everyday choice, participants made successive retailer choices where on each occasion they chose a retailer and only then learned product prices. The results of a series of studies demonstrated that participants were more likely to choose a retailer that offered an everyday low pricing strategy (EDLP) or that offered frequent small discounts over a retailer that offered infrequent large discounts.

This study examines the relation between securitization and loan performance using a comprehensive dataset from a major national mortgage lender. Loans remaining on the bank's balance sheet ex post incurred higher delinquency rates than sold loans, contrasting the negative relation between screening efforts and ex ante probability of loan sale explored by prior studies. Moreover, the performance gap between sold and retained loans was wider among the subsample of loans that were perceived as easier to resell.

Despite a 20-year trend toward integrated marketing communications, advertisers seldom coordinate television and search advertising campaigns. We find that television advertising for financial services brands increases both the number of related Google searches and searchers' tendency to use branded keywords in place of generic keywords. The elasticity of a brand's total searches with respect to its TV advertising is 0.17, an effect that peaks in the morning.

The current research establishes a first-mover disadvantage in negotiation. We propose that making the first offer in a negotiation will backfire when the sender reveals private information that an astute recipient can leverage to his or her advantage. In two experiments, we manipulated whether the first offer was purely distributive or revealed that the sender's preferences were compatible with the recipient's preferences (i.e., the negotiators wanted the same outcome on an issue).

We propose a framework for the joint study of the consumer's decision of where to buy and what to buy. The framework is rooted in utility theory where the utility is for a particular channel/brand combination. The framework contains firm actions, the consumer search process, the choice process, and consumer learning. We develop research questions within each of these areas. We then discuss methodological issues pertaining to the use of experimentation and econometrics.

This paper proposes an accounting framework that breaks up a country's gross exports into various value-added components by source and additional double-counted terms. Our parsimonious framework bridges a gap between official trade statistics (in gross value terms) and national accounts (in value-added terms), and integrates all previous measures of vertical specialization and value-added trade in the literature into a unified framework.

Purpose — The purpose of this paper is to measure the cumulative, holistic impact of discrete information and communication technologies. It also provides a glimpse of applications and service adoption, which complements more traditional perspectives such as technology penetration. This approach is utilized to measure achievements in implementing a policy such as Europe's Digital Agenda.

Recent findings of low societal consensus in cultural values suggest that our field’s dominant paradigm — culture as shared values — is a fallacy. The perennial persistence of this illusion may come from the fact that it appeals to the human brain’s hardwired capacity for essentialism. Evidence against value consensus, however, does not doom all shared-meaning models of culture (pace Schwartz, 2013).

Following the classic work of Mitjuschin, Polterovich and Milleron, necessary and sufficient as well as sufficient conditions have been developed for when the multicommodity Law of Demand holds. However, far less attention has been focused on the nature and properties of violations. To address these questions, the existing sufficient conditions although simpler in form are of little value unless they are also necessary. We show when the widely cited Mitjuschin and Poterovich sufficient condition also becomes necessary.

Learning requires acquiring and using knowledge. How do individuals acquire knowledge of another culture? How do they use this knowledge in order to operate proficiently in a new cultural setting? What kinds of training would foster intercultural learning? These questions have been addressed in many literatures of applied and basic research, featuring disparate concepts, methods and measures. In this paper, we review the insights from these different literatures. We note parallels among findings of survey research on immigrants, expatriate managers, and exchange students.