Research

Working Papers

"From Rivals to Allies? CEO Connections in an Era of Common Ownership" with Dennis C. Hutschenreiter

Abstract: Can institutional shareholders shape the strategic decisions of top managers in their portfolio companies by leveraging CEOs' social connections? This paper reveals that firms with significant common ownership with a competitor are more likely to hire CEOs who have pre-existing social ties with the rival firm's chief executive. Such connections, established during the hiring process, correlate with enhanced performance metrics like return on assets and overall firm value for rivals. Additionally, this strategy decreases product similarity between the hiring firm and its competitors and boosts rivals' stock market returns during the hiring events of connected CEOs. Our findings are more pronounced among closer competitors. By analyzing the effects of exogenous changes in common ownership due to mergers among institutional investors, we discover that the presence of an additional common blockholder with a competitor doubles the likelihood that a firm will appoint a CEO with ties to the competitor’s chief executive.

"Beyond a one-size-fits-all approach to the consequences of telework: Exploring organizational role and job tenure as moderators" with Laura Guillén and Florian Kunze

Abstract: The rise of telework during the COVID-19 pandemic has fueled intense debate over whether it boosts or hinders employee performance. This study investigates the complexities of telework’s effects, emphasizing that its outcomes are not one-size-fits-all. Specifically, we explore how telework influences engagement and self-rated performance, moderated by organizational roles (managers vs. non-managers) and job tenure. Using longitudinal data from 278 white-collar professionals, we show that non-managers benefit from telework, reporting higher engagement and self-rated performance. Conversely, managers experience declines in engagement and self-rated performance when confronted with the demands of remote challenges. Our results also indicate that telework has little impact on engagement levels for employees with longer tenure, regardless of their role. These findings challenge the idea that telework has universally positive or negative employee effects, underscoring the importance of context in understanding its impact. As organizations move toward hybrid work models, this research offers critical insights for tailoring telework strategies to meet the diverse needs of employees based on their roles and experience.

Publications

4. "Pharmaceutical Innovation Collaboration, Evaluation, and Matching," Journal of Health Economics, Forthcoming

(This paper was previously titled "Performance Evaluation and Collaboration Matching between Industry and Academic.")

Abstract: This paper theoretically studies pharmaceutical innovation collaborations, where heterogeneous firms compete for heterogeneous academics. At an interim stage, the firm evaluates the project, which allows it to monitor academics and decide whether to terminate the project to avoid the loss from a future failure. This paper explores the contract, project termination strategy, and collaboration matching. The firm's innovation strategy (exploitations or explorations) determines the evaluation structure, which may affect the market equilibrium. By considering different innovation strategies, this paper shows that in each case, the equilibrium matching is unique (either positive or negative assortative). Consequently, the chosen innovation strategy plays a pivotal role in shaping equilibrium matching outcomes. These findings provide theoretical insights into pharma-academic alliances, shed light on the observed positive or negative assortative properties in the market, and advocate for the consideration of innovation strategies and evaluation structures in future research endeavors. Moreover, this paper also provides several empirical and policy implications.

Abstract: We analyze if and how the characteristics of grant research panels affect the applicants’ likelihood of obtaining funding, especially if particular types of panels favour particular types of applicants. We use the UK’s Engineering and Physical Sciences Research Council (EPSRC) award decisions to test the similar-to-me hypothesis for the first time in the grant context. Our main results indicate that panel members tend to favour more (or penalise less) applicants with similar characteristics to them, as the similar-to-me hypothesis suggests. We show, for instance, that the quality of the applicants is more critical for panels of high quality than for panels of relatively lower quality, that basic-oriented panels tend to penalise applied-oriented applicants, and that discussions with fewer female members tend to penalise teams with more female applicants. As a whole, we show that similar-to-me effects are simultaneously at work for a wide variety of functional, job-related research characteristics as well as for more well-known demographic attributes.

2. "The Impact of Consumers’ Regret on Firms’ Decisions in a Durable Good Market," Journal of Economics, 139, 125–157, 2023

Abstract: This paper studies how the consumer's anticipated regret affects the firms' pricing decisions and profits in a duopoly market. I consider a two-period game with differentiated durable products, where an incumbent sells a basic version over two periods, and an entrant releases an improved version in period 2, of which the improved features are difficult to assess by the consumers. This ambiguity will lead to regret. This paper focuses on two types of regret: a consumer may regret purchasing in period 1 instead of purchasing in period 2 (action regret); a consumer who waited until period 2 might regret not buying in period 1 (inaction regret). The consumers can anticipate the possible regret, which will influence the consumer's decision-making. The results show that both types of anticipated regret may increase or decrease the incumbent’s profit. In contrast, action (inaction) regret always benefits (harms) the entrant. Besides, the analysis indicates that the improved version's quality may either strengthen or weaken the impact of regret. Moreover, this paper examines the robustness of the results under different setups.

1. "Education Choices and Job Market Characteristics," with Inés Macho-Stadler, Economics Letters, 223, 110985, 2023

Abstract: We propose a simple three-stage model where heterogeneous schools compete via tuition fees, individuals with the ex-ante unknown ability make their education choices to (eventually) get a diploma and reveal their ability, and finally the job market determines the assignment of workers to firms and the equilibrium wages. In equilibrium, wages in the labor market and schools’ fees and individuals’ school choices are strongly related. We also analyze the effects of the existence of a public school or a subsidy on social welfare.