First Look: July 26 Job Hunting

First Look: July 26

Each week First Look summarizes new working papers, case studies, and publications produced by Harvard Business School faculty. Here readers will be able to get a “first look” at cutting-edge ideas before they enter the mainstream of business practice. For complete details on faculty research, see our Working Papers section.

Improving policy debate

As the debate over the US debt limit rages on, a group of scholars has prepared a paper on how to improve public policy debate in general. “Policy Bundling to Overcome Loss Aversion: A Method for Improving Legislative Outcomes,” notes that many policies that otherwise would benefit society are nevertheless defeated on arguments that the costs are larger than the gains. The researchersKatherine L. Milkman, Mary Carol Mazza, Lisa L. Shu, Chia-Jung Tsay, and Max H. Bazermanpropose a process whereby related bills are “bundled” so that their collective pluses and minuses can be weighed as a group. “We argue this method can transform unpopular individual pieces of legislation, which would lack the support for implementation, into more popular policies,” according to the scholars. The paper will be published in a forthcoming issue of Organizational Behavior and Human Decision Processes.

Taxing US foreign investment

Speaking of government policy, critics have lashed out at current tax law that allows US firms to defer taxes on unrepatriated income earned in foreign countries. This policy, it is argued, results in fewer tax dollars being collected at home. A new working paper by Mihir A. Desai, C. Fritz Foley, and James R. Hines, Jr., “Tax Policy and the Efficiency of U.S. Direct Investment Abroad” offers support that could favor the tax policy, however. Their research of both repatriated and unrepatriated income shows that US parent companies received considerably more from their foreign affiliates in investment returnsmore than $1 trillionthan the affiliates absorbed in investment resources between 1982 and 2010.

Designing a strategic compensation system

Designing a compensation program to motivate desired behavior can be tricky. At PR firm Marshall & Gordon, where a serious strategic shift was occurring away from traditional PR work, CEO Kelly Browne was faced with creating a system that would shift the culture from individualistic toward collaborative. The case study, “Marshall & Gordon: Designing an Effective Compensation System (A)” will “deepen students’ appreciation for the complexity of designing a compensation system that needs to motivate star performers while encouraging the collaboration necessary to align employees’ behaviors with a new firm strategy,” according to authors Heidi K. Gardner and Kerry Herman.

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