Knowledge at Wharton

Is selling police equipment to a notoriously brutal government tantamount to assisting in torture? William Schulz believes that it can be and that these types of sales are one of the principal ways in which businesses find themselves tangled up with torturers. During a presentation sponsored by Wharton’s Zicklin Center for Business Ethics Research Schulz former executive director of Amnesty Intern...

Call it a gold rush of sorts. Gold topped out at more than $1 000 an ounce in mid-March up from about $680 a year ago. Although it dipped to just under $900 late in April it has had a tremendous run up from $350 five years ago. What has driven these price gains? What does gold tell us about the economy’s future? Should ordinary investors buy it? Knowledge at Wharton talks to the experts. Hosted on...

Richard Fain is chairman and CEO of Royal Caribbean Cruises the Miami-based global cruise company that operates 36 ships under the Celebrity Cruises and Royal Caribbean International brands among others. He joined the company in 1981 as an outside director and became chairman and CEO in 1988. He spent 13 years before that at Gotass-Larsen Shipping Corp. a London-based owner and operator of cargo s...

Ask any CEO or senior level executive what his or her biggest challenge is and the answer is almost always finding and keeping good people. Yet most executives fail to manage their company’s needs in a way that recognizes the unpredictability of the global marketplace. In a book titled Talent on Demand: Managing Talent in an Age of Uncertainty Peter Cappelli director of Wharton’s Center for Human...

The ongoing takeover battle between Microsoft and Yahoo has taken several surprising turns over the past few weeks. After rejecting Microsoft’s unsolicited $44.6 billion offer in late February Yahoo has announced a two-week ad testing program with its main search rival Google and has reportedly entertained a possible merger with Time Warner’s AOL. Meanwhile Microsoft was rumored to be considering...

Companies that use compensation consultants end up paying more to their CEOs leading to allegations that these consultants push for excessively high CEO packages because many of them profit from doing other work for the company. A recent Congressional committee report supported the idea that such conflicts drive up CEO pay. But a new Wharton study by accounting professor Mary Ellen Carter and two...

Microfinance -- the business of providing financial services in small transaction amounts to poor underserved markets -- has taken off in recent years. With financial sectors in many developing countries maturing and microfinance institutions (MFIs) themselves growing rapidly capital markets have been quick to enter the fray providing ample funding for expansion. But microfinance’s evolution in co...

When Bear Stearns collapsed in March some insiders argued it was wrong to blame the firm’s risky bets on mortgaged-backed securities. They had another culprit: malevolent traders working together in the upside-down world of short sales -- making money by knocking down Bear’s stock. There has however been little academic research to explain the forces at work. Now Wharton finance professor Itay Gol...

Images of Chinese guards and local police protecting the Olympic torch on its journey to Beijing were hardly the kind of publicity the IOC or the Chinese government were hoping for. Nor can the 12 ”Worldwide Olympic Sponsors” be thrilled at the latest images of hand-to-hand street fighting. How can sponsors make the August Olympics a brand builder for their products rather than a public relations...

The boundaries between work and play are beginning to disappear as consumer technologies -- including social networking tools user generated content and wikis -- are increasingly adopted by corporate America. For technology companies this emerging ”consumerization” trend represents an opportunity but it also brings new management challenges as companies struggle to embrace these technologies in a...

With a healthy economy that is benefiting from its economically troubled neighbor to the south Canada has little to complain about these days regarding its relationship with the United States -- although there is always room for improvement on both sides. That was the message from Canadian Ambassador Michael Wilson during a recent visit to Wharton during which he addressed a wide range of topics i...

Kevin Roberts has been CEO Worldwide of Saatchi & Saatchi since 1997 and in the space of 11 years has cemented the ad agency’s reputation as one of the most successful and creative companies in the industry. Roberts is perhaps most well known for an idea he came up with called ”lovemarks” -- which means creating a brand for which the consumer has ”loyalty beyond reason.” During a visit to camp...

Securitization is often blamed for aggravating -- if not causing -- the subprime mortgage crisis that keeps roiling U.S. real estate and credit markets. By repackaging pools of mortgages into securities that could be resold to investors the argument goes securitization permitted unscrupulous underwriters to offer housing loans to poor borrowers and transfer the risk to Wall Street. How then will t...

The financial markets are in turmoil. Inflation is picking up. Home prices are falling. More companies are laying off workers. Oil prices are sky-high. It’s getting harder and harder to borrow money. It seems like a nest of conspirators is preying on America. Even Washington is reinforcing the impression with talk of sweeping reforms to the system of economic oversight. Indeed  economic commentato...

Hedge funds are key players in the world’s financial markets but no one knows exactly what they’re up to. Critics and supporters tend to share an assumption however that hedge funds are run by talented people who merit their hefty management fees. But new research by Wharton statistics professor Dean P. Foster and Brookings Institution senior fellow H. Peyton Young questions that idea arguing that...

The video-sharing site YouTube is currently running a comedy sketch contest sponsored by Toyota’s 2009 Corolla. It’s just one of the latest examples of companies using this advertising hot spot to target customers who spend a lot of their time watching online videos. But finding a home in the medium is not so easy Wharton professors say. In a digital world of instant feedback and ruthless honesty...

John Luke Jr. chairman and CEO of global packaging giant MeadWestvaco was a U.S. Air Force pilot in Southeast Asia during the tail end of the Vietnam era. Since coming home to join and eventually run the company he has been responsible for steering a steady course even as flak comes in from all sides. Speaking at a recent Wharton Leadership Lecture Luke said that during MeadWestvaco’s transformati...

When a report prepared by former Senator George J. Mitchell indicated that Roger Clemens and others used illegal performance-enhancing drugs a marketing agency prepared a voluminous report that relied on statistics to make the case for Clemens’ innocence. But an article written by four Wharton faculty -- Justin Wolfers Shane Jensen Abraham Wyner and Eric Bradlow -- questions the methodology used b...

In a new research paper titled ”Dogs on the Street Pumas on Your Feet: How Cues in the Environment Influence Product Evaluation and Choice ” Wharton marketing professor Jonah Berger suggests that what you see in your everyday world can influence what you buy. For example participants in one study who were shown more images of dogs liked sneakers from the Puma brand more than those who had not seen...

Innovation timing a good idea and luck are all ingredients of success in the technology industry according to speakers at the recent Wharton Business Technology Conference titled ”Enterprise Agility: Lead with Speed.” Former Microsoft executive Rob Glaser who went on to found RealNetworks and Glenn A. Britt CEO of Time Warner Cable both said strong technology businesses are built on firm technical...

The ongoing credit crisis in U.S. financial markets has claimed a huge and high-profile victim: Bear Stearns. After being slammed by what amounted to a run on the bank during the week of March 10 the Wall Street firm agreed to be acquired -- for $2 a share -- by JP Morgan Chase over the weekend in a deal overseen by Federal Reserve chairman Ben Bernanke and Treasury Secretary Henry Paulson. The Fe...

With their low fees all-day trading and tax efficiency exchange-traded funds have captivated investors. There were no ETFs before 1993; today there are nearly 700. While most experts think ETFs were a good innovation -- built like index-style mutual funds but traded like stocks -- some worry that the increasingly specialized ETFs introduced in recent years stray from the faith encouraging too much...

New strategies will be necessary for biotechnology companies to thrive in the new era of personalized medicine but the healthcare system itself will also have to change according to a panel of biotechnology company representatives at the 2008 Wharton Health Care Business Conference. Leaving behind the ”blockbuster drug” mentality must be part of a new mindset for biotech companies going forward su...

Accounting techniques like budgeting sales projections and financial reporting are supposed to help prevent business failures by giving managers realistic plans to guide their actions and feedback on their progress. At least that’s the theory. But when Gavin Cassar a Wharton accounting professor tested this idea he found something troubling: Some accounting tools not only fail to help businesspeop...

A tug of war over the future of media may be brewing between so-called user-generated content -- including amateurs who produce blogs video and audio for public consumption -- and professional journalists movie makers and record labels along with the deep-pocketed companies that back them. The ultimate outcome: a hybrid approach that features entirely new business models say experts at Wharton. Ho...