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Autumn 2012 Vol 3

(Covering October 20 to November 8, 2012)

Here are highlights of the latest Booth news coverage.  The digest below represents only a portion of recent coverage.  Questions about this summary should be directed to Allan Friedman, executive director of communications, by reply e-mail or by calling 773-702-9232.

This summary contains three sections.

Section 1: News coverage of Booth.

  • BLOOMBERG BUSINESSWEEK. Booth was featured in an article reporting that salaries are remaining flat for recent business school graduates at many schools. “A handful of schools defied the odds, including the University of Chicago Booth School of Business, where salaries jumped 7 percent since 2010, after inflation is factored in,” the November 1 article said.
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  • THE WALL STREET JOURNAL. Booth was one of the schools featured in an article headlined “M.B.A.s Rethink Wall Street.” While about 20 percent of Booth graduates who accepted offers last year took investment-banking positions, “students’ interest and appetite has become much, much more diverse,” over the past decade, said Julie Morton, associate dean of career services and corporate relations. Students are increasingly lured by Silicon Valley start-ups and stable jobs at consumer-products firms and industrial conglomerates, she said in the October 30 article.
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  • FINANCIAL TIMES. Booth was featured in an article headlined “Schools try to widen their political horizons,” published November 5. “Marianne Bertrand, a professor of economics at the University of Chicago Booth School of Business, believes it is essential that MBA students have a greater awareness of debates concerning market failure, regulation and lobbying,” the article said. “Students arrive in my class with black-and-white views,” she said. While she accepts that these issues may not be directly applied in graduates’ careers, she says that a sophisticated understanding of government’s relevance is critical for students to engage successfully with government policies that affect their companies, the Financial Times reported.
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  • FORBES. Booth was one of the schools featured in an column titled “Does Faculty Research Improve MBA Teaching Quality?” published October 22. Based on a study by Ronald Yeaple, author of the column, “Research-intensive business schools such as Stanford, Chicago, and MIT turned out students having more valuable MBA degrees than other schools with less research activity.”
    Read article 
  • CUNA NEWS. (Credit Union National Association.) The latest Chicago Booth/Kellogg School Financial Trust Index made news November 6 in an article reporting that more Americans trust credit unions than trust banks. Professor Luigi Zingales is co-author of the quarterly trust index.
    Read article 
  • THE ECONOMIST. Ricardo Taveira, MBA ’13, published an MBA Diary article about his experience at Booth and during his internship in Brazil. The article was published October 22.
    Read article 

Section 2: News coverage of Booth faculty.

  • BLOOMBERG NEWS.  Professor Richard Thaler wrote an op-ed titled “Making Risk-Taking Riskier Will Hurt Startups,” published October 24.    “Research in behavioral economics shows that when people consider risky propositions, they are especially concerned about the downside,” he wrote.  “Roughly speaking, people weigh losses about twice as heavily as gains, a phenomenon called ‘loss aversion.’  So if we really want to encourage risk takers and job creators, we should concentrate on what will happen to them in the all-too-likely event that their brilliant idea doesn’t pan out and the new venture flops,” Professor Thaler wrote.
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  • MINT (India).  Professor Raghuram Rajan published an op-ed titled “Central bank adventurism,” October 21.  The danger from pursuing unconventional monetary policy today is that it relieves pressure on politicians, he wrote.  “What should central bankers do when politicians seem incapable of acting?   Thus far, they have been willing to step into the breach, finding new and increasingly unconventional ways to try to influence the direction of troubled economies.  But how can we determine when central banks overstep their limits?  When does boldness turn to foolhardiness?,” Professor Rajan wrote.
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  • THE NEW YORK TIMES.  Research by Deputy Dean Steven Davis on economic policy uncertainty was featured in an article headlined “The Election Won’t Solve All Puzzles,” November 5.    “The claim is that businesses and households are uncertain about future taxes, spending levels, regulations, health care reform and interest rates,” Professor Davis wrote in his research.  “In turn, this uncertainty leads them to postpone spending on investment and consumption goods and to slow hiring, impeding the recovery.”   The research, which appears at www.policyuncertainty.com, was conducted jointly with faculty at Stanford.
    Read article
    The Financial Times also cited the research by Professor Davis, November 6.
    Read article
  • THE ECONOMIST.  Professor Raghuram Rajan was featured in an article looking at “Why Asia is becoming increasingly unequal.”  Professor Rajan pointed out that India has the second-largest number of billionaires relative to the size of its economy after Russia, mainly because of insider access to land, natural resources and government contracts.   “He worries that India could be becoming ‘an unequal oligarchy or worse,’” the magazine reported October 13.
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  • THE ECONOMIST.  Professor Raghuram Rajan was featured in an article headlined “Having your cake; Less inequality does not need to mean less efficiency,” published October 13.  “In an influential recent book, ‘Fault Lines’, Raghuram Rajan pointed to inequality as the underlying cause of America’s 2008 crash,” the article said.  “As less-educated Americans saw their incomes fall, he suggested, politicians encouraged reckless mortgage lending so that poorer folk could keep up their living standards by borrowing.
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  • THE ECONOMIST.  Research by Associate Professor Brent Neiman and Assistant Professor Loukas Karabarbounis was featured in an article headlined “Dead money; Cash has been piling up on companies’ balance-sheets since before the crisis.”   A rapid reversal is unlikely, the article said.  That’s because rising corporate saving has deeper roots than the crisis, the commodities boom or this interest-rate cycle.  In a recent study, Professors Neiman and Karabarbounis found that across 51 countries they examined between 1975 and 2007, companies’ share of private saving rose in aggregate by 20 percentage points.  In countries where corporate saving rose, labor’s share of GDP in the corporate sector shrank, by five percentage points in aggregate, the November 3 article said.
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  • THE WALL STREET JOURNAL.  Research by Associate Professor Adair Morse and Assistant Professor Margarita Tsoutsoura was featured in an article headlined “New Twist in Greek Tax Saga,” October 28.  Despite years of austerity, Athens’s efforts to crack down on tax evasion – which costs the government as much as 28 billion euros a year – have been poor, Professors Morse and Tsoutsoura found.
    Read article
  • THE WALL STREET JOURNAL.  Professor Randall Kroszner discussed whether President Obama’s reelection changes the outlook for the “fiscal cliff,” during a video interview on the newspaper’s website November 7.
    Watch video
  • FOX BUSINESS TELEVISION.  Professor Austan Goolsbee reacted to the October jobs numbers, the last major piece of economic data before the presidential election.  During the past 2-1/2 years, the U.S. has added about five million jobs, Professor Goolsbee said during the interview broadcast November 2.
    Watch video
  • FORTUNE.  Professor Eugene Fama was featured in the “Best Advice I Ever Got” section October 25.  “When I came to the University of Chicago in 1960, I was exposed to professors who were involved in the nascent subject of finance, which didn’t exist as a discipline at the time.  It was all being born, and it just happened that I had come to the place where that birth was happening.   In my first year I took an intermediate statistics class with a professor named Harry Roberts.  What I learned from Harry was a philosophy.  He gave me an attitude toward statistics that has stuck with me ever since,” Professor Fama wrote.
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  • CHICAGO TRIBUNE.  Professor Randall Kroszner was quoted in an article headlined “Beyond ‘fiscal cliff,’ unknowns lurking,” published November 8.   He said he expects the federal government will paste a bandage on the fiscal cliff as a temporary solution because no one wants to take the fall for whatever economic damage it threatens to cause.  “Firms are not willing to take on long-term investment, because they don’t have a clue what the structure and level of taxes will be,” Professor Kroszner said.
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  • MARKETPLACE RADIO.  Professor Sanjay Dhar was featured in a story about companies that used Hurricane Sandy as a marketing tool.  While American Express offered emergency financial and travel assistance, American Apparel promoted a “Hurricane Sandy Sale,” the story said.    American Apparel should have softened the tone of its ad by offering to help its customers, Professor Dhar said in the October 31 broadcast.  “I think it would have made a big difference,” he said.
    Listen to broadcast
  • CRAIN’S CHICAGO BUSINESS.  Clinical Professor James Schrager was quoted in an article headlined “Is this Best Buy’s last Christmas?” published November 5.   “They’re going to survive the holiday season only because the holiday season is a gimme,” Professor Schrager said.  “You can’t go to a restaurant on a Saturday night to decide if it’s doing well, and you can’t judge a retailer on the holiday period.  You have to visit the restaurant on a Tuesday, and you have to look at the retailer in January, February and March.”
    Read article
  • NATIONAL PUBLIC RADIO.  Professor Randall Kroszner discussed the U.S. employment situation during an interview broadcast on Weekend Edition November 3.  “It’s very important for sustainable, overall economic growth to be creating private-sector jobs,” he said.  “The government perhaps can provide a stopgap, but that’s very, very temporary at best.”
    Listen to broadcast
  • THE NEW YORK TIMES.  Adjunct Assistant Professor John Paul Rollert wrote an opinion column headlined “Slight of the ‘Invisible Hand,’” October 21.  “Much has been made of Paul Ryan’s devotion to, and timely disavowal of, Ayn Rand and her work,” he wrote.  “But little has been said about (Adam Smith) the Scottish philosopher he and Mitt Romney have cited as the ideological embodiment of what’s at stake in this election.”
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  • CNBC.  Professor Austan Goolsbee discussed the economic impact of Hurricane Sandy during an interview broadcast October 31.   Whatever the initial dollar estimates are, the final cost of a natural disaster typically ends up being one-and-a-half to two-times higher, he said.
    Watch video.
  • BLOOMBERG TELEVISION.  Professor Luigi Zingales discussed U.S. tax and entitlement reforms and fiscal policy during an appearance on the Surveillance program October 25.
    Watch video
  • BBC WORLD SERVICE RADIO.  Assistant Professor Anuj Shah discussed his new behavioral science research on the Science in Action program November 1.   His research, “Some Consequences of Having Too Little,” takes a novel approach to understanding why low-income people might act against their own financial self-interest by over-borrowing at high interest rates.   Austrian Public Radio (ORF)  and Swiss Public Radio also broadcast stories about Professor Shah’s research.
    Listen to BBC broadcast
    The Independent of London also published an article about Professor Shah’s research.
    Read article
    The Los Angeles Times wrote about Professor Shah’s research November 3.
    Read article
  • PBS NEWSHOUR.  Professor Austan Goolsbee discussed the economic challenge of slow growth that will face whoever wins the November 6th presidential election.   Also appearing on the segment, which aired November 2, was John Taylor from Stanford.   
    Watch video
  • ABC NEWS.COM.  Research by Assistant Professor Wilhelm Hofmann was featured in an article headlined “Facebook, Email More Irresistible Than Sex,” published October 28.
    Read article
  • MARKETPLACE RADIO.  Professor John Cochrane gave post-election comments in an interview broadcast November 7.   He foresees continued gridlock in Congress and no permanent solution to the “fiscal cliff” issue.
    Listen to broadcast
  • HUFFINGTON POST.  Research by Professor Marianne Bertrand was featured in an article headlined “Does Race or Gender Influence Professional Judgment?” published October 29.  The article highlighted Professor Bertrand’s paper “Do Judges Vary In Their Treatment of Race?”   She and her co-authors found that race “appears to play a role in judicial decision-making,” which “suggests that courtroom outcomes may not be race blind.”
    Read article
  • NBC CHICAGO.COM.  Research by Professor Chad Syverson on productivity was featured in an article titled “How to Be More Productive,” posted October 31.    Professor Syverson’s research “has revealed a lot about how people get things done and what speeds that process up,” the article said.    His work appeared earlier in Capital Ideas, a publication highlighting research at Booth.
    Read article
  • MONEY NEWS.COM.  Research by Deputy Dean Steven Davis on economic policy uncertainty was featured in an article published November 5.     Sustained economic uncertainty has an adverse impact on future economic performance, he said, cutting 2 million to 2.5 million jobs over two years.    There is more uncertainty on the economic landscape than at any other period prior to 2008, Professor Davis found.
    Read article

Section 3:  Booth students and alumni in the news.

  • THE WALL STREET JOURNAL.   Rex Sinquefield, MBA ’72, was profiled in an article headlined “Meet One of the Super-PAC Men,” published October 27.   “His name isn’t Adelson or Koch, but he’s spending millions on politics, hoping to roll back taxes and reform education,” the article said.   “At 67, Rex Sinquefield is a successful businessman and conservative who is passionate about his country and wants to turn its policies in a more prosperous direction.  He’ll even spend lots of his own money to do it.”
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  • CHICAGO TRIBUNE.  Erik Sewell, MBA ’14 and Bryson DeTrent, MBA ’14 were featured in an article headlined “Veterans battle to capture work; But more employers valuing their qualities,” published October 28.    Sewell said many military professionals often don’t market themselves effectively or convey adequately how transferable their skills are to the civilian world.  DeTrent said one reason why younger vets, particularly women, haven’t found jobs is because it’s too easy to collect unemployment, according to the article.
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  • CHICAGO SUN-TIMES.  Bob Mariano, MBA ’87 (XP-56) was featured in an article headlined “Mariano’s keeps expanding in Chicago market,” published October 27.   He is CEO of Roundy’s Supermarkets, which recently opened its eighth Mariano’s store in the Chicago area.   He said there could be 30 such stores in the area in the next five years.  The article mentioned that Mariano has an MBA from Booth.
  • CNBC.COM.  Alana Muller, MBA ’98, published an opinion column titled “The boomer Entrepreneurs: Never Too Old to Launch a Business,” October 23.    She is president of Kauffman FactTrac, a company that trains aspiring and existing entrepreneurs.
    Read article
  • DALLAS (Tex.) BUSINESS JOURNAL.  Thomas Greenlee, MBA ’00, was named CFO of the Year in the October 26 edition of this newspaper.  He is CFO of Glazer’s Distributors, based in Dallas.
    Read article
  • MILWAUKEE BIZ TIMES.  Tricia Geraghty, MBA ’01, was named corporate vice president for marketing and public relations at Children’s Hospital of Wisconsin, according to an October 26 article.   Previously she was vice president of marketing and communications at Marquette University.
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