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Booth in the News; Winter 2012, Vol. 4

(Covering February 4 to 28, 2012)

Here are highlights of the latest Chicago Booth news coverage. The digest below represents only a portion of recent coverage.

Section 1: News coverage of Chicago Booth.

  • FINANCIAL TIMES. Booth’s annual U.S. Monetary Policy Conference in New York made news February 24 with the release of new research show how the housing bust continues to affect the recovery. The paper is “well worth a read. Not only for its assessment of the housing market, but also on the implications for policy,” according to this newspaper account of the research by Professor Amir Sufi and co-authors. The conference also received coverage in The Wall Street Journal, The New York Times and elsewhere. Nineteen reporters attended. 
    Read Financial Times article 
    Read the New York Times article
  • MSNBC. The Dylan Ratigan Show was broadcast live from the Rothman Winter Garden February 24. Professor Steven Kaplan participated in a 12-minute discussion on whether business schools are contributing to society and whether new M.B.A.s are taking the “right” jobs. During the discussion Professor Kaplan mentioned the many successful businesses that got their start in Booth’s New Venture Challenge. 
    Watch video
  • HONG KONG ECONOMIC TIMES. Dean Kumar discussed new developments at Booth in an interview during his recent trip to Hong Kong. He expects the public profile of the school to increase now that the television studio in Harper Center is finished. The studio will make it easier for faculty members to make TV appearances. Dean Kumar also said steps are being taken to help Booth develop closer ties to its alumni. The article, published February 13, included a photo of Booth students in a classroom.
  • CRAIN’S CHICAGO BUSINESS. Booth’s EMBA and non-degree executive education programs were featured in an article about the benefits of business education for mid-career executives. The EMBA is designed for people to take the knowledge they gain in the classroom and apply it in the workplace immediately, said Patty Keegan, associate dean of Booth’s EMBA. About one-quarter of the students enrolled in the program are fully funded by their employers, she said in the article published February 20. 
    Read article
  • THE WASHINGTON POST. The latest survey of Booth’s Economic Experts Panel made news February 20 in an article headlined “Four out of five economists agree: The stimulus created jobs.” The ongoing survey is conducted by the Initiative on Global Markets. 
    Read Washington Post article
    Many other newspapers published articles about the IGM’s Experts Panel, including the Atlanta Journal Constitution on February 21. 
    Read Atlanta Journal Constitution article
  • WINSTON-SALEM JOURNAL (North Carolina). A team of Booth students won the $75,000 first prize in annual marketing case competition at Wake Forest University’s business school. UCLA’s Anderson School of Management was second and Wharton was third. Students developed marketing plans for Hanesbrands Inc.’s hosiery division, whose sales have slumped in recent years with lower consumer demand for sheer-hosiery products. The six second-year students on the winning Booth team were Christina Maria DesVaux, Sinem Guzelce, Sohee Lacey, Anna Liu, Gina Pee and Tom Batten. The article was published February 21. 
    Read article 
    Read a news release about the competition

Section 2: News coverage quoting Chicago Booth faculty.

  • THE WALL STREET JOURNAL. Professor Austan Goolsbee published an op-ed titled “Jeremy Lin and America’s ‘New Exports’” February 21. “The U.S. runs a huge trade surplus in tourism, tuition paid by foreign students, even NBA jerseys sold abroad,” he wrote. Referring to New York Knicks star Jeremy Lin, Professor Goolsbee said “I will root for more Linsanity because with every game watched in Asia, jersey sold in Europe or visit to an NBA game by a foreign tourist, this young man is doing more than just helping his team. He’s demonstrating a way for our economy to grow.” 
    Read article
  • THE NEW YORK TIMES. Professor Richard Thaler published an op-ed titled “Making Good Citizenship Fun,” February 13. “Governments typically use two tools to encourage citizens to engage in civic behavior like paying their taxes, driving safely or recycling their garbage: exhortation and fines,” he wrote. “These efforts are often ineffective. So it might be a good time to expand the government’s repertory to include positive reinforcement. Rewarding good behavior can work.” 
    Read article
  • THE NEW YORK TIMES. Professor Richard Thaler published an op-ed titled “Gay Marriage Debate Is About Money, Too,” February 18. “Here’s a two-question quiz,” he wrote. “If Pat and Chris want to form a business partnership in your home state, should their sexes play any role in determining whether that partnership is legal? Should the government play any role in deciding the rules regarding religious ceremonies like christenings and bar mitzvahs? If you answered ‘no’ to both questions, you are on your way to solving the same-sex marriage debate in the United States,” Professor Thaler wrote. 
    Read article
  • THE WALL STREET JOURNAL. Professor John Cochrane published an op-ed titled “The Real Trouble With the Birth-Control Mandate,” February 9. “When the administration affirmed last month that church-affiliated employers must buy health insurance that covers birth control, the outcry was instant,” he wrote. But “critics are missing the main point … There are good reasons that your car- insurance company doesn’t add $100 to your premium and then cover oil changes … Insurance is a bad idea for small, regular and predictable expenses.” 
    Read article
  • MINT (India). Professor Raghuram Rajan published an op-ed titled “The public and its problems,” February 14. Don’t blame world leaders for appearing indecisive and short-sighted, “The fault may lie with us, the public, for not listening to the worrywarts,” he wrote. “If the problem has not been experienced before, the public is not convinced of the potential costs of inaction. And, if action prevents the problem, the public never experiences the averted calamity and voters, therefore, penalize political leaders for the immediate costs that the action entails.” 
  • BLOOMBERG NEWS. Professor Pietro Veronesi published an op-ed titled “Why U.S. Treasuries Won’t Always Be a Haven,” February 23. “Treasuries are now considered a haven,” he wrote. “However, this will only be true until the return of an inflationary regime. Caveat emptor.” 
    Read article
  • BLOOMBERG NEWS. Clinical Professor Brian Barry published an op-ed titled “Why Energy-Cutting Policies Are Badly Designed,” February 8. “Has the U.S. pursued ineffective approaches to energy conservation because its policy maker are flawed people, in which case maybe they can be nudged to consider better ideas and information?” he wrote. “Or do their energy policies show that politics is a flawed market, which inflicts too little pain on officials when their choices impose negative spillovers on the public?” 
    Read article
  • THE NEWS (Mexico). Professor Luigi Zingales published an op-ed titled “In the line of fire,” February 3. “Central bankers should not only be above suspicion of wrongdoing, but also appear to be above it,” he wrote. “So the decision in January by Philipp Hildebrand, Chairman of the Board of the Swiss National Bank (SNB), to resign over allegation relating to a suspicious currency trade made by his wife, is to be welcomed.” 
  • LE CERCLE LES ECHOS (Paris). Professor Ronald Burt published an op-ed about the advantages of social networks January 19. “Technology has moved diversity problems to center stage in business,” he wrote. “Technology lets us connect with colleagues and clients across the globe, but most people grew up working in organizations composed of people like themselves.” 
    Read article
  • THE WALL STREET JOURNAL. Professor Steven Davis was quoted in an article about labor market problems caused by too few employees quitting their jobs. As risk-averse employees stay put, job opportunities aren’t opening up, the article said. “For workers who are unemployed, if there’s less churning of jobs, it’s harder to get on the merry-go-round,” Professor Davis said. “There are just fewer openings arising.” The article was published February 8. 
    Read article
  • THE ECONOMIST. Research by Professor Steven Davis was featured in an article about the U.S. job market. He found that recruiting intensity dropped by nearly 22 percent during the recession and has since rebounded by less than 6 percent. Recruiting efforts explain about a third of the variation in the pace at which vacancies are filled, Professor Davis found. The article, headlined “Go for the churn: The number of job-to-job moves by American workers tells a bleak story,” was published February 11. 
    Read article
  • THE NEW YORK TIMES. Separate research by Professor Luigi Zingales and Associate Professor Juhani Linnainmaa was featured in an article headlined “What High-I.Q. Investors Do Differently,” published February 25. Professor Zingales found that many households avoid investing directly in stocks out of vague fears that they might be deliberately misled or cheated, the article said. Professor Linnainmaa’s research showed that people with relatively high I.Q.’s typically diversify their investment portfolios more than those with lower scores and invest more heavily in the stock market. They also tend to favor small-capitalization stocks, which have historically beaten the broader market, as well as companies with high book values relative to their share prices. 
    Read article
  • CNBC. Professor Randall Kroszner discussed U.S. economic conditions during an appearance on Squawk Box February 15. He opposed the recent Federal Reserve promise to keep short term interest rates at near zero until late 2014. “I wouldn’t have gone quite that far,” he said, adding that late 2013 might be a better time to start thinking about raising rates. Professor Kroszner was a governor of the Federal Reserve System from 2006 to 2009. 
    Watch video
  • CNBC. Professor Austan Goolsbee appeared in an interview segment titled “Too Much Optimism on U.S. Economy?” broadcast February 12. The interview aired during the Squawk Box program. 
    Watch video
  • THE WALL STREET JOURNAL. Professor Steven Kaplan was quoted in an article headlined “SEC Launches Inquiry Aimed at Private Equity.” The inquiry examines, in part, how firms value their investments. “There’s often room for differences of opinion, and some firms are purposely conservative, while others want to make themselves look better,” Professor Kaplan said. “I’m not sure how much it matters, though, because [private-equity] firms only get paid when they return money” to investors after selling a company. The article was published February 11. 
    Read article
  • CNBC. Professor Randall Kroszner defended the Federal Reserve’s low interest rate policy during an appearance on the Kudlow Report February 3. “I don’t think we’d be having the growth that we are having now without the low interest rate policy,” he said. 
    Watch video
  • CORRIERE DELLA SERA (Milan). An entire article devoted to Professor John Cochrane’s views on the economic situation in Greece and elsewhere in Europe was published February 21. 
    Read article in Italian
  • FINANCIAL TIMES. Research by Assistant Professor Wilhelm Hofmann on the allure of media desires was featured in the “Something for the Weekend” section February 17. Similar coverage also appeared in Forbes, The Times of India, FOX News, Huffington Post and elsewhere. 
    Read article
  • THE ECONOMIST. Research by Professor Robert Vishny was cited in an article on financial innovation published February 25. One election in the financial crisis was a failure to understand the risks inherent in various products until it was too late, the article said. The resulting fragility is described in a 2010 paper on financial innovation by Professor Vishny. 
    Read article
  • BLOOMBERG BUSINESSWEEK. Professor Steven Kaplan was quoted in a commentary headlined “Is Any CEO Worth $189,000 Per Hour?” The system has worked, Professor Kaplan said in the article published February 15. CEOs are “paid for performance.” The commentary, written by Roger Lowenstein, said “fixing CEO pay -- making it more reflective of what executives are truly worth -- would go a long way toward restoring America’s faith in business, and in equal treatment.” 
    Read article
  • MARKETWATCH.COM. Research by Professor Amir Sufi was featured in an article headlined “Invest in the European countries with low debt,” published February 15. Everything we are learning about the post-credit crush economy right now suggests that debt constrains growth, the article said. Professor Sufi’s research found that states in the U.S. with the highest debts suffered the deepest recessions. 
    Read article
  • LE MONDE (Paris). An entire article devoted to research by Professor Marianne Bertrand was published February 2. The article was titled “The Trouble with Boys: The gender gap and social influences on educational achievement.” She studied 20,000 boys and girls who entered kindergarten in 1988 and found that almost one boy in four had been suspended by eighth grade, compared with only one girl in ten. A suspension decreases the likelihood of completing high school by 17 percent and the likelihood of attending a university by 16 percent, the research found.
  • THE NEW YORK TIMES. Professor Steven Kaplan was quoted in an article about private exchanges that traded private shares of Internet companies like Facebook, Twitter and others. “Facebook was quite unusual,” he said. “It attracted a lot of buyers. A company with a 50- to 100-billion-dollar market capitalization that hasn’t gone public yet is not an everyday occurrence. It’s an every five to 10 years occurrence.” The article was published February 2. 
    Read article
  • REUTERS. Research by Associate Professor Jonathan Rogers and Assistant Professor Sarah Zechman was featured in a commentary headlined “How to avoid a securities class action,” published February 10. Professors Rogers and Zechman identified 165 companies that were sued because their share price fell after an earnings statement had pointed to strong future performance. Optimistic words elevated the chance of litigation slightly, they found. But what really raised the odds was an optimistic announcement followed by a sale of stock by company insiders. The column was published February 10. 
    Read article
  • ASSOCIATED PRESS. Clinical Professor James Schrager was quoted in an article about the retirement of two key executives at Ford Motor Co. Investors shouldn’t be concerned about the retirements or the fact that Alan Mulally, CEO, hasn’t announced when he’ll leave, Professor Schrager said in the article published February 9. Mulally would risk being a lame duck if he announced a date. “He’s got to maintain very firm control of the business.” 
  • BLOOMBERG NEWS. Professor John Huizinga was quoted in an article about the corporate sponsorship potential of New York Knicks’ starting point guard Jeremy Lin. Companies will want to see how Lin performs over a full season before committing to him, Professor Huizinga said. “It all depends on his on-court performance. He’s got a lot of possibilities, but basketball ought to be his sole focus.” The February 10 article noted that Professor Huizinga is also a professional sports agent whose clients include Yao Ming, now retired after an All-Star career in both China and the NBA. 
    Read article
  • FORBES. Professor Chad Syverson was quoted in an article about clean air regulations in the U.S. The benefits of the regulations are typically estimated at more than $100 billion in improved health, reduced infant mortality and increased property values, he said. The cost is about $21 billion per year in lost productivity, he said. The article was published February 27. 
    Read article
  • FORTUNE. Professor Sanjay Dhar was quoted in an article looking at why many eco-friendly businesses are thinking twice before screaming green. “What’s important is looking at the fit between customers and products,” Professor Dhar said in the article published February 9. “You must assess the needs and motivations of your customers and the importance of integrating the message of green with … the product.” 
    Read article
  • THE INDEPENDENT (London). Professor Richard Thaler was featured in an article about the success of the “Nudge unit” in Britain’s government. “The man who elevated ‘nudge’ into a political catchphrase was the Chicago-based academic Richard Thaler, who visited the UK in 2008 to promote his theory and met David Cameron,” the February 8 article said. “Mr. Thaler made such an impression that for a time he acted as unpaid adviser to the Tory leader.” Professor Thaler is co-author of the popular book “Nudge: Improving Decisions About Health, Wealth, and Happiness.” 
    Read article
  • MINNEAPOLIS STAR TRIBUNE. Professor Randall Kroszner said it isn’t clear how useful the Federal Reserve’s increased communication will be in the U.S. “Since the crisis has happened since early 2009, it’s not clear that the markets have really found the Swedish central bank’s pronouncement of the direction of interest rates to be very informative,” he said. “The jury is out on how this is going to work in the United States.” The article was published February 14. 
    Read article
  • THE ATLANTIC. Research by Professor Steven Kaplan on was featured in an article headlined “Will Inequality Keep Getting Worse?” published February 9. He found that the share of national income going to the top 1% had fallen “dramatically,” the article said. 
    Read article
  • CHICAGO MAGAZINE. Dean Kumar was included on a list of the 100 most powerful Chicagoans published in the March issue. The list also includes Adjunct Professors Bradley Keywell and Eric Lefkofsky, and Booth alumni Joe Mansueto, ’80, founder and CEO of Morningstar, Tom Ricketts, ’93, chairman of the Chicago Cubs, and Joanne Smith, ’00, president and CEO of the Rehabilitation Institute of Chicago. 
    Read article
  • HINDUSTAN TIMES. Dean Kumar and Professor Raghuram Rajan were featured in an article about top Indian-born academics. “Indians in the U.S. clearly bring a strong global perspective,” Dean Kumar said. “The strength of the Indian education system creates advantages.” The article noted that Professor Rajan correctly predicted the recent recession at a gathering of economists in 2005.
  • POETS AND QUANTS.COM. Professor Raghuram Rajan was named one of the world’s best business school professors by this website on business education. “He is widely credited for the warning signs he posed in the years leading up to the economic collapse in the U.S.,” the accompanying article says. “Specifically looking at the banking industry, Professor Rajan took a gutsy stand when he explicitly outlined the threats posed by a banking industry that lacked effective risk management.” The article was published February 13. 
    Read article
  • BLOOMBERG BUSINESSWEEK. Professor Steven Kaplan was quoted in an article headlined “Perella Loses $22.5 Million Fee After NYSE Deal Is Blocked,” published February 3. After Deutsche Boerse AG and NYSE Euronext ended their merger agreement, Parella Weinberg Partners won’t get its fee, “but the visibility is probably a positive as long as they were perceived to have given good advice,” Professor Kaplan said. “I don’t think this would be viewed as something that could’ve been fixed by different financial advice.” 
    Read article
  • BLOOMBERG NEWS. Clinical Professor Scott Meadow was quoted in an article about GOP presidential candidate Mitt Romney’s track record as a jobs creator at companies including Sports Authority, which he founded while head of Bain Capital. Romney doesn’t get emotionally involved, said Professor Meadow, who served as lead investor on the Sports Authority deal for William Blair & Co. “He’s able to convey ideas in a very succinct and precise manner that is persuasive.” The article was published February 27. 
    Read article
  • INTERNATIONAL BUSINESS TIMES. Emeritus Professor Marvin Zonis was quoted in an article about austerity measures aimed at improving the Greek economy. Austerity stifles the impetus for many reforms, he said. “By making the economies worse, people lose their appetite for changing the system and as governments continue to weaken they too have no mandate to implement change. All of this (austerity) is very short-sighted,” Professor Zonis said in the article published February 23. 
    Read article
  • WBEZ RADIO (Chicago). Professor Amil Sufi talked about the impact of the $25 billion mortgage settlement between state attorneys general and five big banks. “It’s marginally going to have a positive impact,” he said. “I just don’t think it’s going to attack the really huge problem in a really major way.” The interview was broadcast February 10. 
    Listen to broadcast

Section 3: Chicago Booth students and alumni in the news.

  • BLOOMBERG BUSINESSWEEK. Ronald Rolph, MBA ’11, was featured in an article headlined “For U.S. MBAs, Going Global Has Never Been Easier,” published February 8. He turned down an offer for a position in the U.S. to work for the same company in a preferred role that combines engineering, construction, and project management in the mining and metals industry in Santiago, Chile, the article said. “Just because you go overseas initially does not mean you’re relegating yourself to working overseas for the rest of your career,” Rolph said. 
    Read article
  • THE NEW YORK TIMES. Kelsey Martin, MBA ’13, was featured in an article headlined “Survival Training for When a Pilot’s World Turns Upside Down,” published February 6. The article included a photo of him, taken during winter break while he was doing two weeks of service in the Navy Reserve at Naval Air Station Whidbey Island, Washington. 
    Read article
  • CRAIN’S CHICAGO BUSINESS. PrepMe, the start-up founded by Karan Goel, MBA ’06, was sold to a division of Hobsons Inc., according to a February 20 article. PrepMe won Booth’s New Venture Challenge in 2005. The company helps students prepare for SAT, ACT and PSAT exams. Goel has stepped down as CEO. 
    Read article
  • ECONOMIC TIMES OF INDIA. Vikramm Vuppala, MBA ’07, was featured in an article about his start-up NephroPlus, a chain of dialysis clinics launched in 2010 in India. He was working as a senior associate at McKinsey & Company when he decided to return to India to become an entrepreneur, the February 19 article said. 
  • CHICAGO SUN-TIMES. Donna Zarcone, MBA ’87, was named president and CEO of The Economic Club of Chicago, according to a February 15 article. She had been serving as interim president. Earlier in her career she was head of Harley-Davidson’s financial services business. Zarcone serves on the board of Booth’s Polsky Center for Entrepreneurship. 
    Read article
  • THE NEW YORK TIMES. Erroll Davis, MBA ’67, was profiled in an article headlined “A New Leader Helps Heal Atlanta Schools, Scarred by Scandal,” published February 20. Davis became the superintendent of the public school system in Atlanta in 2011. The article mentioned that he is a graduate of Booth. 
    Read article