Penalties - Publications - Faculty & Research

November 2007
Article

If Private Equity Sized Up Your Business

By: Robert C. Pozen

This article includes a one-page preview that quickly summarizes the key ideas and provides an overview of how the concepts work in practice along with suggestions for further reading. As the dust settles on the recent frenzy of private equity deals (including... View Details

Keywords: Mergers and Acquisitions; Capital Structure; Private Equity; Investment Return; Governing and Advisory Boards; Executive Compensation; Business and Shareholder Relations; Value Creation; Financial Services Industry

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02 Feb 2023
Research & Ideas

Why We Still Need Twitter: How Social Media Holds Companies Accountable

violations and penalties issued by 44 regulatory agencies, during the period between 2000 and 2017. First, they obtained digital maps of 3G network coverage, determined the year in which 3G became available for a certain ZIP code, and... View Details

Keywords: by Kasandra Brabaw; Technology

10 Dec 2021
Research & Ideas

Truth Be Told: Unpacking the Risks of Whistleblowing

incentivizes employees to report issues where the penalty is high." Dey: There are a lot of issues that well-meaning managers and boards may not know about. There may be something bad going on in one subsidiary, or one factory, or with... View Details

Keywords: by April White

22 May 2024
HBS Case

Banned or Not, TikTok Is a Force Companies Can’t Afford to Ignore

There are limits on when kids can use the application. The content is required to promote objectives of the government. There are significant penalties for not following regulations. As a result, the system becomes a powerful tool to... View Details

Keywords: by Rachel Layne; Technology

16 Jan 2013
Research & Ideas

The Messy Link Between Slave Owners and Modern Management

group incentives to encourage honesty, doling out a barrel of corn to each hand with the caveat that if anything was stolen from the farm and no one turned in the thief, double the value of that corn would be deducted from each of their Christmas awards. Collective... View Details

Keywords: by Katie Johnston

29 Nov 2022
Research & Ideas

Is There a Method to Musk’s Madness on Twitter?

lost critical people in the background who make this whole thing work. Gazette: Twitter has been under a consent decree for over a decade over data privacy and security violations. Back in May, the company had to pay the Department of Justice and Federal Trade... View Details

Keywords: by Christina Pazzanese, Harvard Gazette; Technology

31 Mar 2008
HBS Case

JetBlue’s Valentine’s Day Crisis

service-oriented airline, one of the issues students wrestle with is whether or not the airline needed to be this specific in how the penalties and compensation would work," says Huckman. The students seem to come down evenly on both... View Details

Keywords: by Julia Hanna; Air Transportation

13 Aug 2012
Research & Ideas

When Good Incentives Lead to Bad Decisions

officers receive small rewards for loans that perform well and small penalties for loans that perform badly); and the high-powered incentive (in which officers receive big rewards for issuing loans that perform well, but big View Details

Keywords: by Carmen Nobel; Banking

09 Apr 2018
Sharpening Your Skills

The Dark Side of Performance Bonuses

salaries? Researchers present evidence that workers dislike inequality in equity compensation more than salary compensation because of the perceived scarcity of equity. Subjectivity in Tournaments: Implicit Rewards and Penalties and... View Details

Keywords: by Sean Silverthorne

22 Jul 2002
Research & Ideas

Is Performance-Based Pricing the Right Price for You?

important ones. But, some limited variants can also be useful. "Point" guarantees such as penalty clauses which involve a discount when delivery is late are a simple form of performance-based pricing. View Details

Keywords: by Benson Shapiro; Manufacturing

17 Aug 2021
Op-Ed

Dispensing Justice: The Case for Legalizing Cannabis Nationally

severe penalties The legal cannabis industry is hamstrung by its federal illegitimate status. Barred from interstate commerce, the US cannabis industry has become an agglomeration of 37 fragmented, isolated markets. Each state that has... View Details

Keywords: by Ashish Nanda and Tabatha Robinson

Research Summary

Corporate Lobbying Strategy and Foreign MNEs

“U.S. Defense Contracts and the Lobbying Strategies of Foreign MNEs: The Liability of Foreignness and Make-or-Buy Decisions about Political Goods”

Many firms engage in lobbying with the expectation that their lobbying efforts will... View Details

Keywords: Non-market Strategy; Political Strategy; Lobbying; Make V. Buy; Multinational Enterprise; Global Strategy; United States

26 Mar 2018
Research & Ideas

To Motivate Employees, Give an Unexpected Bonus (or Penalty)

we try and find other reasons to explain it,” Gallani says. Which rewards motivate workers? In a new working paper written with doctoral student Wei Cai, Subjectivity in Tournaments: Implicit Rewards and Penalties in Subsequent... View Details

Keywords: by Michael Blanding; Manufacturing

07 Jan 2019
Research & Ideas

The Better Way to Forecast the Future

from when measuring accuracy. Scoring rules can nudge forecasters in one direction by giving a penalty for overestimating or underestimating. Whatever rule is accepted should align with overall goals. In the hurricane example, forecasters... View Details

Keywords: by Roberta Holland; Air Transportation; Transportation

23 Aug 2021
Research & Ideas

Why White-Collar Crime Spiked in America After 9/11

her study, it “remains a puzzle why financial fraud persists despite the severity of the penalties for and negative consequences of being caught.” Her study set out to probe the extent to which FBI enforcement deters white-collar crime.... View Details

Keywords: by Jay Fitzgerald

30 Jul 2007
Research & Ideas

Repugnant Markets and How They Get That Way

there already is a market for kidney sales, but it is illegal and dangerous. A lot of abuses happen in the illegal kidney markets. For example, in China they get organs from executed prisoners. They defend it. They say, "You Americans have a death View Details

Keywords: by Martha Lagace

24 Feb 2022
Op-Ed

Want to Prevent the Next Hospital Bed Crisis? Enlist the SEC

meeting surges in capacity and to explain how they derived that estimate. Transparency as a solution often fails because of a lack of enforcement or overly complex regulations. For example, when President Biden issued an executive order that warned of stiffer View Details

Keywords: by Regina Herzlinger and Richard Boxer; Health

01 Feb 2021
What Do You Think?

Has the New Economy Finally Arrived?

wage rates and inflation, and therefore low unemployment and inflation. One way to think about the model is that nirvana is the point at which the economic benefits of lower unemployment no longer exceed the economic penalties of... View Details

Keywords: by James Heskett

10 Feb 2003
Research & Ideas

Commodity Busters: Be a Price Maker, Not a Price Taker

percentage of cost savings. Or, a contractor might be paid more for finishing a job early. There are many variations to performance-based pricing including penalty clauses. But, the idea is always the same. Base your price on the value... View Details

Keywords: by Benson P. Shapiro

08 Oct 2021
Research & Ideas

How Newspaper Closures Open the Door to Corporate Crime

thousands of facilities of publicly listed firms, Heese identified the towns where the local newspaper presses permanently came to a halt. Heese found that after a newspaper shuts down, violations at publicly listed companies in the paper’s circulation area increased... View Details

Keywords: by Avery Forman

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