Finance

- November 2022
- Case
Entrepreneurship Through Acquisition: Brian's Journey

By: Richard S. Ruback, Royce Yudkoff and Sarah Livick-Moses
- November 2022
- Case
Entrepreneurship Through Acquisition: Brian's Journey

By: Richard S. Ruback, Royce Yudkoff and Sarah Livick-Moses
- November 2022
- Case
Dicerna

By: Malcolm Baker, Ishita Sen and Jonathan Wallen
- November 2022
- Case
Dicerna

By: Malcolm Baker, Ishita Sen and Jonathan Wallen
- November 2022
- Case
Ava Labs: Navigating the Next Blockchain

By: Marco Di Maggio and Wenyao Sha
- November 2022
- Case
Ava Labs: Navigating the Next Blockchain

By: Marco Di Maggio and Wenyao Sha

About the Unit

Our strategy is to assemble and nurture a faculty whose interests and skills complement each other, and who work well together:

a) to produce a broad range of finance-related research that is published in top-tier scientific and practitioner journals, and that addresses issues of present and future importance to managers (including regulators and policy makers);

b) to develop highly-relevant and intellectually rigorous MBA and executive education courses; and

c) to mentor future academics through the Business Economics doctoral program.

Our applied focus and access to business organizations are major advantages which are reinforced by our students and our case-based approach. We have a faculty with broad expertise, and we have resources, field contacts, and institutional support, all of which we can leverage to do richer work and be more productive than we could at other institutions.

Recent Publications

Choose Your Own Adventure: Your Financial Health (B): 5 Years Later, What Now?

By: Sara Fleiss and Emily R. McComb

December 2022 |
Exercise |
Faculty Research

Citation

Entrepreneurship Through Acquisition: Brian's Journey

By: Richard S. Ruback, Royce Yudkoff and Sarah Livick-Moses

November 2022 |
Case |
Faculty Research

Citation

Educators

Purchase

Dicerna

By: Malcolm Baker, Ishita Sen and Jonathan Wallen

November 2022 |
Case |
Faculty Research

Citation

Educators

Ava Labs: Navigating the Next Blockchain

By: Marco Di Maggio and Wenyao Sha

November 2022 |
Case |
Faculty Research

Citation

Educators

Choose Your Own Adventure: Your Financial Health (A): Congratulations, HBS Grad! Now, What?

By: Sara Fleiss and Emily R. McComb

November 2022 (Revised December 2022) |
Exercise |
Faculty Research

Citation

Shared Models in Networks, Organizations, and Groups

By: Joshua Schwartzstein and Adi Sunderam

2022 |
Working Paper |
Faculty Research

To understand new information, we exchange models or interpretations with others. This paper provides a framework for thinking about such social exchanges of models. The key assumption is that people adopt the interpretation in their network that best explains the data, given their prior beliefs. An implication is that interpretations evolve within a network. For many network structures, social learning mutes reactions to data: the exchange of models leaves beliefs closer to priors than they were before. Our results shed light on why disagreements persist as new information arrives, as well as the goal and structure of meetings in organizations.

Keywords: Social Learning Theory; Theory; Social Issues; Cognition and Thinking; Social and Collaborative Networks; Attitudes

The Retail Habitat

By: Toomas Laarits and Marco Sammon

2022 |
Working Paper |
Faculty Research

Retail investors trade hard-to-value stocks. Controlling for size, stocks with a high share of retail-initiated trades are composed of more intangible capital, have longer duration cash-flows and a higher likelihood of being mispriced. Consistent with retail-heavy stocks being harder to value, we document that such stocks are less sensitive to earnings news. As an additional consequence, the well-known earnings announcer risk premium is limited to low retail stocks only. Further, high-retail stocks are more sensitive to retail order flow and are especially expensive to trade around earnings announcements. Overall, the findings document a new dimension of investor heterogeneity and suggest the comparative advantage of retail in holding hard-to-value stocks.

Keywords: Retail; Retail Trade; Intangible Capital; Mispricing; Investment; Valuation; Business Earnings

Citation

Read Now

Century Bank: Closing Time?

By: Lauren Cohen, Grace Headinger and Bill Kwon

October 2022 |
Case |
Faculty Research

Barry Sloane, second-generation Chairman, President, and CEO of his family’s bank, Century Bank, weighed whether to sell to Eastern Bank. As a small regional bank, Century faced a number of challenging trends, such as digitization and market share decline in the coming years, despite its past decade of top performance, balanced growth, and careful risk management. Whereas his father consistently refused to sell during his lifetime, Sloane worried this might be the last cash offer on the table for the bank. On the other hand, selling was an irreversible decision that would severe the family’s legacy and the next generation from the bank. Was it finally time for the Sloane family to part with Century Bank?