The Federal Reserve generally waits until inflation has grown precipitously before raising interest rates. On Bloomberg Surveillance, Marvin Goodfriend, The Friends of Allan H. Meltzer Professor of Economics, indicates that the Fed might “move preemptively to stabilize inflation at 2 percent” in March. This turned out to be the case when, on March 15, 2017, interest rates rose from 0.75 percent to 1 percent.
During his campaign, President Donald Trump promised to raise America’s economic growth from 2 percent to as high as 4 percent while he was in office, in part by limiting corporate taxes and regulations. Several respected economists have indicated this promise is possible, so long as the economy is not hindered by other factors. “It’s not in the bag, but it borders on the likely,” Allan Meltzer, The Allan H. Meltzer University Professor of Political Economy, told Fortune in an article analyzing Trump’s policies and actions in this vein.
Poets & Quants
In The Economist’s most recent survey of MBA graduates, the Tepper School placed within the top five in the faculty ranking, scoring a 4.79 on a five-point scale. According to Michael Trick, senior associate dean of faculty and research and the Harry B. and James H. Higgins Professor of Operations Research, it is the faculty’s focus on cutting-edge research that sets the Tepper School apart.
“We really value the research of our faculty and we reward faculty for that research. We also want that research to show up in the classroom itself,” he told Poets & Quants. “That means that students are getting some really current stuff. It is rare that the content in many of our classrooms is coming out of textbooks.”
This winter the Tepper Women in Business club hosted its second annual Women’s Leadership Conference, an event designed to teach valuable networking and leadership skills to students and local professionals. Robert Kelley, distinguished service professor of management, presented at the event, highlighting the importance of men serving as allies for women.
“Men have to get on board. Most women are well aware of these issues ... but the issues won’t be tended to and resolved in a fair and equitable way until men get involved,” Kelley said of the gender gap in the workforce.
Wall Street Journal
Former professor Yuji Ijiri, the R.M. Trueblood University Professor of Accounting and Economics Emeritus, died on January 18, 2017.
Ijiri, recognized by his former colleagues and fans for work that was “brilliant and startling in originality,” was well known for his invention of “triple-entry accounting,” a system that would not only provide information about income, but also about the rate at which it was earned.
Poets & Quants
Over the past several years, tech has become a go-to industry for Tepper School MBA graduates, particularly women. In fact, more than 30 percent of the Tepper School class of 2016 accepted jobs in the tech industry. Notably, 45 percent of female 2016 graduates entered careers in technology (versus 29 percent of male graduates).
Each year Tepper School students travel to the San Francisco Bay Area to get a taste of this technology-hub, and during this year’s trek Poets & Quants caught up with Dean Robert Dammon, Career Opportunities Center Executive Director Stephen Rakas, and MBA students Anna Lawrence and Shweta Aladi.
During business negotiations, the parties involved are often communicating in different ways. It can be frustrating when one person values providing clear information while someone else prioritizes persuading others into agreement. PORK Network offers nine negotiation archetypes into which most people fall.
Laurie Weingart, senior associate dean of education and the Richard M. and Margaret S. Cyert Professor of Organizational Behavior and Theory, notes that those who prioritize cooperation are more likely to be satisfied with the outcomes. “Individual differences in ‘social motives,’ ... or our preferences for certain kinds of outcomes ... strongly affect how we approach negotiations.”
U.S. News & World Report
As compared to campus-based programs, online offerings for MBA studies typically attract a greater diversity of geography, industry and experience. This, U.S. News argues, is of great benefit to the students involved in such programs, because they are exposed to a broader range of perspectives.
Online coursework gives students the opportunity to complete their studies while embedded within a business environment like Silicon Valley or New York City, said Bob Monroe, director of the Online Hybrid MBA and associate teaching professor of business technologies. He reported that students in the PTOH format represent 25 states and a few other countries.
While companies expend money and effort soliciting new points of view that will help them get ahead in the market, many overlook an existing resource from within their ranks: the women who are frequently missing or underrepresented in board rooms and executive offices. BOSS Magazine cites research coauthored by Anita Williams Woolley, associate professor of organizational behavior and theory, reporting that when working groups contain more women, they typically perform better at brainstorming and problem solving.
U.S. News & World Report
Each year, U.S. News & World Report releases a list of top online MBA programs across the country, a ranking based on data related to student engagement, admissions selectivity, peer reputation, faculty credentials, and student services and technology.
This year the Tepper School’s Part-Time Online Hybrid Program continued to climb that list, earning a No. 2 ranking — up from No. 6 last year.
Times Higher Education
A highly controversial topic in the United States, affirmative action is widely implemented in India. Students considered disadvantaged within the country’s stratified caste system, as well as female students, receive preferential treatment during the admissions process.
Writing for Times Higher Education, Dennis Epple, Thomas Lord University Professor of Economics, notes that the transparent process and consistent standards across higher education makes studying the effects of affirmative action in India much easier than in the United States. Together with Lowell Taylor at the Heinz College, Epple found that affirmative action increases the likelihood that targeted populations will attend college and improve their academic performance.
Wall Street Journal
Survey respondents often indicate that they believe people who offer their time and service toward charitable causes are doing more good than those who give money. Many also assume that sacrificing your own time or money in order to help others interferes with your personal satisfaction. However, donations can often go further than time in helping organizations provide services, and most people report higher levels of happiness about giving to others than about treating themselves.
Christopher Olivola, assistant professor of marketing, writes in the Wall Street Journal that people generally admire someone who gives in ways that require spending more effort more than someone who writes a check — what he refers to as the “martyrdom effect” — even in hypothetical examples that indicate the money can go toward helping more people. He also reports that people are more likely to give to charity if they are reminded that if they do not, the charity gets nothing.
Finding the perfect gift for a loved one can be a challenge. Many gift-givers try to select something that will delight the recipient when they open it, hoping for the instant gratification of their genuine thanks.
Research by Jeff Galak, associate professor of marketing, and Ph.D. student Julian Givi, explains the crucial errors that consumers might be making when purchasing gifts for others. The research finds that, while the giver focuses on the “moment of exchange” and the immediate appeal of the gift, the recipient might be more focused on long-term utility of the item.
Poets & Quants started their own ranking of undergraduate business programs in 2016 that incorporated admissions standards, student experience and employment outcomes and placed the Tepper School at No. 24 out of 50 schools.
Yahoo! Finance followed up on the ranking by highlighting eight of the schools whose graduates, on average, earn a starting salary of at least $70,000. The article goes further to point out that 98 percent of undergraduate business administration students at the Tepper School complete an internship before graduation.
In April 2016, the United States signed the Paris Agreement, a commitment from nearly every country to reduce greenhouse gas emissions. Following the election of Donald Trump, several climate scientists and environmentalists spoke out about their concerns that the new president would renege on the agreement, particularly given his commitment during his campaign that he would revive coal mining in the country.
However, coal’s decline in the United States was less because of environmental policies and more due to the rise of natural gas, according to Jay Apt, co-director of the Carnegie Mellon Electricity Industry Center. He noted that natural gas is much cheaper than coal, and may be even more so should Trump allow more drilling.
Venture capitalist Jim Swartz, MSIA ’96, offered Carnegie Mellon University $31 million to support entrepreneurial education at the university. The gift, which is the fifth largest in the university’s history, supported the development of the Swartz Center for Entrepreneurship, which launched this past fall.
The goal of the center is to bring innovations from within the Carnegie Mellon community to the marketplace more quickly and successfully, Dave Mawhinney, MSIA ’90 and director of the Swartz Center, told the Tribune-Review.
Often in an effort to dodge the larger corporate tax rate in the United States, companies will sometimes acquire a foreign firm and re-incorporate such that the offshore company is classified as the parent, and therefore subject to that country’s tax rate instead. Brent Glover, assistant professor of finance, studied 60 of these inversions over the last 20 years.
When corporate tax inversions take place, the study found, long-term investors in the company are subject to much larger capital gains taxes than short-term shareholders. “It is worth noting that although some shareholders may be made off worse by the inversion, it's value-increasing for others,” Glover said. “So the fiduciary responsibility to shareholders can be tricky to evaluate in these cases.”
Wall Street Journal
Prospective business school students have been retaking the GMAT more often than usual, typically resulting in a higher score that cancels out any previous ones. “What’s most important is the highest score they attain,” said Kelly Wilson, executive director of masters admissions. She indicated, however, that there is value for admissions officers to see all of the candidate’s scores as part of the evaluation process.