Posts filed under ‘– Klein –’
This Week’s Sign of the Apocalypse
| Peter Klein |
The University of Chicago’s Graduate School of Business now requires prospective students to submit a PowerPoint presentation as part of their applications (via Cliff). “We wanted to have a freeform space for students to be able to say what they think is important, not always having the school run that dialogue,” says Rose Martinelli, associate dean for student recruitment and admissions. “To me this is just four pieces of blank paper. You do what you want. It can be a presentation. It can be poetry. It can be anything.” I suppose requiring a written essay, in English prose and following conventional rules of grammar and style, would be unduly confining.
According to Dean Martinelli, as reported in the Washington Post, students “won’t be judged on the quality of their slides. Rather the slides are an outlet for judging the kind of creativity the business world needs.” Adds second-year MBA student Michael Avidan: “If there’s one foundation of business, it’s innovation, and this is your chance to elevate yourself and show you can do something innovative.” Huh?
Pros and Cons of Academic Blogging
| Peter Klein |
Scott Eric Kaufman, a PhD candidate in English literature who blogs at Acephalous, says academic blogging connects scholarship to the wider world:
There’s no reason our community needs to consist solely of people we knew in grad school. Why not write for people who don’t already how you think about everything? Why not force yourself to articulate your points in such a way that strangers could come to know your thought as intimately as your friends from grad school do?
The informal publishing mechanisms available online can facilitate such communication so long as bloggers write for an audience informally. Senior faculty might continue to orient their scholarly production to the four people whose scholarly journals don’t pile up in the corner of the living room, slowly buried beneath unpaid bills and unread New Yorkers. Whether they know it or not, bloggers write for an audience larger than the search committees we hope to impress. They have already started eye-balling the rest of the world, asking themselves how they can communicate with it without seeming to pander to it.
But the signal-to-noise ratio is very low, counters Adam Kotsko, a PhD student in theology: (more…)
Hawthorne Experiments Online Exhibition
| Peter Klein |
As part of its 100th anniversary HBS is featuring a number of online exhibitions, including this one on the famous Hawthorne Experiments from 1924 to 1933. A nice set of photos, documents, and commentary.
Here is Jeffrey Sonnenfeld’s 1985 article on the Hawthorne studies (JSTOR), emphasizing their role in challenging the Taylorite “scientific management” paradigm and laying the groundwork for the modern discipline of organizational behavior. “The prevailing notions of the time of the Hawthorne studies were that individual human behavior was to be corrected for and controlled. The study of purely formal static social structures all but disappeared with the publication of the Hawthorne research. . . . [T]he Hawthorne researchers were the first to emphasize the social complexities of organization life and what came to be called a systems approach (p. 115).”
Here is the Wikipedia entry on the Hawthorne effect, the phenomenon of subjects in a behavioral experiment changing their behavior in response to being observed (or, more generally, anyone behaving differently in response to attention). The section of the exhibit on the Hawthorne effect is slicker but less detailed.
How Commies Build Cars
| Peter Klein |
A funny clip from an old Trabant factory in East Germany. (Via Per Bylund.)
The Perils of Microcelebrity
| Peter Klein |
I was pleased to learn that I might be a microcelebrity: someone “extremely well known not to millions but to a small group — a thousand people, or maybe only a few dozen.” This definition comes from Clive Thompson, who suggests in the current issue of Wired that anyone with a blog, a Facebook page, a Flickr account, or a similar web presence can be a microcelebrity in this sense. “Odds are there are complete strangers who know about you — and maybe even talk about you.”
Okay, in my case perhaps “nanocelebrity” is the better term. The broader point, according to Thompson, is that in today’s highly transparent, densely networked, web 2.0 world in which more and more of our personal information ends up preserved for posterity in the Google cache, people may be reluctant to say or do anything that could be controversial.
Blog pioneer Dave Winer has found his idle industry-conference chitchat so frequently live-blogged that he now feels “like a presidential candidate” and worries about making off-the-cuff remarks. Some pundits fret that microcelebrity will soon force everyone to write blog posts and even talk in the bland, focus-grouped cadences of Hillary Clinton (minus the cackle).
As a university professor I worry about this from time to time. Will some off-hand remark made in class end up on a student’s blog? Some students record my lectures on their mp3 players (usually, though not always, with prior permission). Will audio clips — or, heaven forbid, video clips — of me fumbling and stumbling over some difficult concept end up on YouTube?
Shane Seminar in Entrepreneurship
| Peter Klein |
Scott Shane’s PhD seminar in entrepreneurship takes place twice this summer, 23-27 June and 4-8 August 2008. Two of my PhD students have gone in recent years and each came back with a glowing report. (I wouldn’t mind seeing some of these papers on the reading list, but hey, nobody’s perfect!)
Fundamental Questions About Organizations
| Peter Klein |
Our most popular tag here at O&M seems to be ephemera, but occasionally we write a “big think” post (e.g., this one). Today I’ll offer another. A colleague recently asked me to write down, for a research project we’re sketching out, some “fundamental questions about organizations.” He wanted my off-the-cuff response, not a carefully crafted set of ideas. Here’s what I came up with:
1. Does organizational form matter? How much does it really affect performance, however measured? Organizational form might not be that important because (a) its effects on performance are small relative to the performance effects of technical or allocative efficiency; (b) organizational form is easily changed and always chosen optimally to fit the circumstances; or (c) organizational form is merely a legal distinction without any economic significance. (more…)
The Power of Incentives, Monday Morning Edition
| Peter Klein |
1. The Vatican is trying incentive pay. (Prediction from Bob, Jeff, and company: performance will fall as worldly, extrinsic motivation pushes out warm, ethereal “feelings for the entity.”) (Via Luke Froeb)
2. My friend Tim Terrell reports on this new program at Wofford College:
My college recently instituted a free bicycle sharing program on campus. There was a lot of self-satisfied puffery from those responsible for the program, with even a “Blessing of the Bikes” ceremony carried out by our chaplain.
Informal polls I conducted in my classrooms indicated that the bikes are being tossed in the shrubbery, left unlocked, used as makeshift shot-puts on Fraternity Row, etc. etc. I passed one left lying on the grass, unlocked of course, on my short walk in to my office this morning. One student says he saw a vagrant in the neighborhood riding around on one. After a little over a week, another student remarked that most of the bikes were in the maintenance shop for repairs. We are now subject to a barrage of flyers, e-mail announcements, etc. pleading with students to treat the bikes well and lock them up (there is a single code to all the combination locks — want to guess how long it took people from the neighboring campus to figure out the code?).
Bob and Jeff, what happened? Surely all these opportunistic, ethically challenged students can’t be economics majors.
JMS Special Issue on the Entrepreneurial Theory of the Firm
| Peter Klein |
In the Spring of 2005 I attended a terrific workshop on “The Entrepreneurial Theory of the Firm,” organized by Sharon Alvarez and Jay Barney and held at Ohio State University. Participants included Mark Casson, Dick Langlois, Sid Winter, Ulrich Witt, Ivo Zander, Simon Parker, Todd Zenger, Steve Michael, Bill Schultze, and several others. The papers and discussions explored a variety of approaches for linking the theory of entrepreneurship to the economic and strategic theory of the firm, a subject near and dear to our hearts here at O&M.
The workshop papers have now been published as a special issue of the Journal of Management Studies (volume 44, number 7, November 2007), edited by Sharon and Jay. A special contribution from Brian Loasby, who wasn’t able to attend the workshop, is included. And don’t miss this paper from an unusually structured joint-spousal team.
Gobble, Gobble
| Peter Klein |
Happy Thanksgiving to our American readers, who gather around the table today to celebrate with family and friends and give thanks for that great legacy bequeathed to us by our Pilgrim forebears — property rights, of course!
Seven Wonders of the Totalitarian World
| Peter Klein |
On a recent trip to Paris my wife suddenly remarked, in horror, “Do you realize that all the famous Parisian landmarks are government buildings?” It’s true, there’s not a private-sector creation among them, unless you count churches or the Tour Montparnasse (which I think was built with private funds). Come on kids, let’s see the next monument to government waste!
On a related note, if you like black humor, check out this Esquire piece on the Seven Wonders of the Totalitarian World. It’s fascinating, in a creepy sort of way. (Only structures built by second- and third-world despots are included, which rules out the grotesque US Embassy in Baghdad.) (HT: Steve Sailer)
Mizzou-KU in the WSJ
| Peter Klein |
We don’t normally discuss trivia such as college football here at O&M (we prefer other trivia). But when your team’s big game makes the front page of the WSJ, you have to say something.
A story in today’s paper, “New Powers in College Football Carry Old Baggage,” focuses on this weekend’s showdown between the undefeated 2nd-ranked Kansas Jayhawks and the 4th-ranked Missouri Tigers, two normally-mediocre teams that have exploded onto the national stage this season. The subject is not the game itself, but the historical hatred between Missourians and Kansans that goes back to the Civil War (or, as we call it around here, the War or Northern Aggression).
This hatred dates back to the 1850s, when the Great Plains state of Kansas became a beachhead for men around the country committed to ending slavery. Many, however, hid behind that noble cause, all the while killing, pillaging and raping their way across the culturally Southern state to the east, Missouri. These Kansas guerrillas called themselves Jayhawkers — supposedly a combination of two birds, the jay and the hawk. (more…)
Poor INSEAD
| Peter Klein |
Business school Insead, founded in 1957 in Fontainebleau, France, opened a campus in Singapore in 2000 and markets itself as “Business School for the World.” “People assume the majority of faculty and students are French,” complains Insead Dean Frank Brown. “That’s not true.”
We’re not French — not that there’s anything wrong with that. This comes from an interesting item about firms with multiple corporate headquarters in yesterday’s WSJ. Lenovo has corporate offices in Beijing, Singapore and Raleigh, N.C. Thomson SA CEO Frank Dangeard says he doesn’t “want people to think we’re based anyplace.” Lenovo’s William Amelio claims the concept of a home country is “outdated.” (Pankaj Ghemawat, call your office!)
There’s a bit of work in multinational strategy about the distribution of subsidiaries across countries and the relationships between subsidiaries and the corporate office. I’m not aware of any studies on multiple corporate offices, however. Any suggestions?
Ghemawat: Borders Matter
| Peter Klein |
The world is still round, says Pankaj Ghemawat in his new book Redefining Global Strategy: Crossing Borders in a World Where Differences Still Matter (HBS Press, 2007). Here’s an interview that lays out the main argument. FDI, for example, is growing, but remains only about 10% of total global investment. If the world is flat, asks Ghemawat, why isn’t it much more? The answer is institutions, though the exact mechanisms by which the institutional environment contributes to home-country bias are unclear. (Thanks to Marshall Jevons for the video pointer.)
See also Ghemawat’s blog posts on global strategy from the HBS Discussion Leaders site.
Introducing Guest Blogger Steven Phelan
| Peter Klein |
We’re very pleased to welcome Steve Phelan as our newest guest blogger. Steve is associate professor of management at the University of Nevada, Las Vegas, founding editor of the Strategic Management Review, and author of many interesting papers on entrepreneurship, cognition, networks, and the resource-based theory of the firm. Steve’s been a regular commentator for some time and we’re happy to have him join us on the “main page.” Welcome, Steve!
Jacques Barzun Turns 100
| Peter Klein |
Jacques Barzun, the eminent historian and cultural critic, turns 100 in a couple of weeks. Barzun has written more books than I’ve read so it’s hard to give an overall summary of his contributions. This New Yorker profile tells us that “[m]ore than any other historian of the past four generations, Barzun has stood for the seemingly contradictory ideas of scholarly rigor and unaffected enthusiasm.” Now that’s a nice tribute.
Many of my friends like Barzun’s 2000 book From Dawn to Decadence: 1500 to the Present: 500 Years of Western Cultural Life, a sweeping history that compares favorably to Martin van Creveld’s Rise and Decline of the State. Perhaps more relevant for the O&M crowd is Barzun’s 1974 Clio and the Witch Doctors: Psycho-History, Quanto-History, and History, a defense of traditional, qualitative, narrative history against the newer disciplines of cliometrics and what Barzun calls “psycho-history.” Cliometrics, which substitutes simplistic, mono-causal explanations for the complex interplay of people and institutions through time, is attempting “to rescue Clio from pitiable maidenhood by artificial insemination.” Agree or disagree, you have to respect the way the man writes.
Langlois on McCraw on Schumpeter
| Peter Klein |
Former O&M guest blogger Dick Langlois reviews Thomas McCraw’s Schumpeter biography, Prophet of Innovation, for EH.Net.
McCraw is at his best in conveying Schumpeter the man, providing an engaging and beautifully written portrait of this larger-than-life and often tragic figure. McCraw also works hard at weaving Schumpeter’s economics into the life story and at making the ideas supply their share of the drama. The result deepens our understanding of a fascinating and complex man and of the difficult times in which he lived, even if it does not necessarily sharpen our understanding of his economics or add much that is new to his biography.
See also our previous comments on McCraw and Schumpeter more generally.
AEI Conference on Private Equity
| Peter Klein |
Those of you in the Washington, DC area may wish to drop by “The History, Impact, and Future of Private Equity: Ownership, Governance, and Firm Performance,” November 27-28 at AEI. The lineup features heavyweights like Michael Jensen, Glenn Hubbard, Josh Lerner, Steve Kaplan, Ken Lehn, Karen Wruck, Annette Poulsen, Mike Wright, and David Ravenscraft, along with a few not-so-heavyweights like me. From the conference announcement:
From humble beginnings twenty-five years ago on Wall Street, the leveraged buyout boom has developed into a veritable industry; today, 30 percent of all corporate merger and acquisition activity in the United States is driven by buyout firms, and the sector commands over $2 trillion in leveraged assets. Along with hedge funds and real assets, private equity is now seen as an important alternative investment class, and fundamental changes in corporate control, governance, modern capital markets, institutional investing, and the funding of entrepreneurial pursuits have all been driven by the growth and evolution of the private equity sector.
My view is that the growth of the PE sector represents an increasingly important manifestation of entrepreneurship — not only because private equity helps fund new ventures, but because the creation of new financial instruments such as high-yield (“junk”) bonds, the establishment and management of diversified buyout funds, the use of private equity to restructure public enterprises, and the like are themselves entrepreneurial acts, given an appropriately broad understanding of entrepreneurship.
Econometrics Haiku
| Peter Klein |
From Keisuke Hirano (via Marginal Revolution). Samples:
Supply and demand:
without a good instrument,
not identified.T-stat looks too good.
Use robust standard errors —
significance gone.From negation comes
growth, progress; not unlike a
referee report.
A Plea for Economic Education
| Peter Klein |
As economists have long emphasized, individuals need not understand the full benefits of participation in the division of labor to benefit from it. But when the market is continually under attack from special interests and from ideologues both left and right, a little knowledge goes a long way. Jeff Tucker puts it nicely:
The old-style classical liberals [Adam Smith, Hayek] reveled in the fact that [the market’s] “impersonal forces” worked without anyone really being aware of them, or having to understand them. The checkout lady at the store just shows up, pushes buttons, gets paid, and stays or leaves based on her assessment of her own well-being. Everyone else does the same. The pursuit of self-interest generates this amazing global matrix that benefits everyone.
The old liberals reveled in the fact that no one had to understand it, but then the system itself came under attack, and needed defense. It had to be understood to be explained, and explained in order to be preserved.
This is why Ludwig von Mises set out to revise liberal doctrine. It is not enough that people participate unknowingly in the market economy. They must understand it, and see how, and precisely how, their smallest and selfish contribution leads to the general good, and, moreover, they must desire that general good.
All of which is to say that in an enlightened world, it would be a good thing for that cashier to understand economics from the point of view of those who pay her. It would be good for striking workers to understand how they are harming not only their bosses but also themselves. It would be good for voters to see how supporting government benefits for themselves harms society at large.
An economically literate public is the foundation for keeping that amazing and wild machine called the market working and functioning for the benefit of the whole of humanity.
Organizations and Markets 
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