Four Ways Companies Can Encourage Innovation

Michael Gibbs and his co-researchers—Susanne Neckermann and Christoph Siemroth—analyzed the progression of 5,000 ideas at a large IT firm and identified a few operational decisions that collectively paid off more than tenfold. Their findings, especially when coupled with those of their colleagues in academia and industry, contain four approaches companies can use to spur innovation.

How Simon Kuznets Codified Modern Economic Growth

Simon Kuznets, winner of the third Nobel Memorial Prize in Economic Sciences in 1971, helped transform the field of economics into an empirically-based social science. An excerpt from Robert Fogel’s book on the great economist.

How Gary Becker Saw the Scourge of Discrimination

In the 1950s, few economists thought of phenomena such as racial discrimination as under their purview. That changed in 1957, when Gary S. Becker, Professor of Economics and of Sociology at the University of Chicago and at Chicago Booth before his death in 2014, published The Economics of Discrimination, a book based on his 1955 PhD thesis.

Becker’s analysis would extend the reach of economics, and … [ Read more ]

When Social Networks Go Astray

Most of the time, developing and mining a network is a smart move. A person develops social networks hoping and expecting to gain something—whether that be a job, contact, investor, or simply a friend. He may turn to those networks when in need or feeling vulnerable, perhaps when trying to make a risky business decision.

But avid networker, beware: these social networks have a dark side. … [ Read more ]

Strategic Links: Why Firms Own Production Chains

Vertical integration does not necessarily mean that a company’s upstream plants supply inputs to its downstream operations. In fact, it is more likely that they do not.

Top Talent

Looking for the best CEO? A recent study finds that efficient and persistent decision makers trump good listeners.

Neighbor Networks: Understanding the Power of Networks

A surprising finding on the value of colleague networks leads to an even more remarkable revelation of how networks truly work.

Forums vs. Fountains: Universities and the Evolution of Knowledge Networks

Universities can help boost a mature industrial economy by reinvigorating the flow of new ideas in the community. But universities can approach this task in different ways, each leading to vastly different outcomes.

Fitting In or Starting New?

An entrepreneur will not always succeed in positioning his latest innovation the next “new thing.” New research suggests that the creation of a new category depends not only on the novelty of the technology but also on whether the existing labels in the market are well understood.

Going for the Goal: The Human Psychology of Rewards

People tend to exert more effort as they get closer to their goals. Companies can take advantage of this by designing a customer rewards program that makes the perceived distance to the reward seem small.

Building a Better Brand: How Feelings Shape Product Evaluation

Traditional branding strategy would say that a label should tell the consumer what the product is all about. New research suggests that just the opposite might be true–the consumer should see himself in the label.

The Gentle Power of Choice Architecture

Can subtle features of everyday situations really enhance our health, wealth, and happiness? A new book shows that they can, and that it is possible to proactively structure situations to nudge us toward better choices while protecting, or even expanding, individual freedoms.

Discretion Meets Disclosure

It has long been suspected that fear of competition spurs managers to hide better-than-average business unit profit performance. However, a new study instead finds evidence that fear of increased oversight leads managers to hide less-than-average business unit performance.

Who Do You Trust?

A degree of mutual trust is an essential component of any economic exchange.Recent research suggests that this trust is not only based on objective considerations of trustworthiness, but is also affected by cultural heritage. This cultural bias in trust has important effects on global trade and investments.

Long-Term Consumption: A Microeconomic Approach to Studying Asset Pricing

A fundamental economic question is the tradeoff between investment and consumption and how it determines asset prices in the macroeconomy. New research studies the relationship between consumption and asset prices using microeconomic data.

The Price of Time: From Shopping to Social Security

Economists have always been interested in understanding the link between household consumption and savings. New research analyzes how people substitute time for money.