Pricing during COVID

Here are great examples of firms using better pricing techniques during COVID (WSJ, Dec. 2020).

How to improve accountability for social responsibility

Edmansand and Gosling point out flaws with focusing on purpose rather than profit and offer a suggestion about how to increase accountability for corporations pursuing purpose (WSJ, Dec. 2020).

How to become a billionaire

Paul Graham says that the best way to secure YC funding is to convince the investors that "what you're making will ever be something a lot of people want" (Paul Graham, Dec. 2020). 

Here are some money quotes:

1. "So this is one thing the YC partners will almost certainly dig into during your interview. Who are your first users going to be, and how do you know they want this? If I had to decide whether to fund startups based on a single question, it would be "How do you know people want this?""
2. "The worst advice I ever heard about how to succeed in a YC interview is that you should take control of the interview and make sure to deliver the message you want to. In other words, turn the interview into a pitch. ⟨elaborate expletive⟩. It is so annoying when people try to do that."
3. "If professional billionaire scouts know that exploiting people is not the skill to look for, why do some politicians think this is the defining quality of billionaires?"
4. "The most reliable way to become a billionaire is to start a company that grows fast, and the way to grow fast is to make what users want. Newly started startups have no choice but to delight users, or they'll never even get rolling. But this never stops being the lodestar, and bigger companies take their eye off it at their peril. Stop delighting users, and eventually someone else will.

The case for having women on the board

 

WSJ Oct. 2020

Will money managers increase diversity?

"David Swensen is the veteran investment chief of Yale University’s $31.2 billion endowment. Earlier this month, he told the dozens of firms that manage Yale’s money they would be measured on their progress increasing the diversity of their investment staffs" (WSJ Oct. 2020).

Let's conduct a thought experiment. Suppose that the executives face incentives that encourage them to maximize returns on the money they manage. 

1. If executives know that diversity increases returns, would Yale need to measure progress on increasing diversity? Would the threat of moving to another company align the interests of Yale and the money managers?
2. Under what conditions would the threat compensation improve the alignment the interests between Yale and the money managers?
3. Under what conditions would the mandate and compensation misalign the interests?

Does having labor sit on the board increase wages?

  

This paper says that the answer is,"No".

I predict that Starbucks will report more diversity in its workforce by 2025

"Starbucks Corp. SBUX -0.68% said it would mandate antibias training for executives and tie their compensation to increasing minority representation in its workforce" (WSJ Oct 2020). 

Let's conduct a thought experiment. Suppose that the executives face incentives that encourage them to maximize profit (or value). 

1. If executives know that antibias training and minority representation increase profit, would Starbucks need to mandate antibias training and tie compensation to increasing minority representation? Would the mandate and compensation improve the alignment the interests of the executive and owners?
2. Under what conditions would the mandate and compensation improve the alignment of the interests of executives and owners?
3. Under what conditions would the mandate and compensation misalign the interests of executives and owners?