We examine the impact of collocation on local within-firm performance, or intra-firm spillovers, by decomposing spillovers into one-time stock and recurring flow effects. Stock effects include one-time learning effects. Flow effects include ongoing resource sharing as well as cannibalization....

Managerial incentives influence risk-taking as well as effort. Theoretical research has long considered risk-taking to be a potential side effect of incentive pay, but empirical analysis of risk-taking incentives has been more limited. This paper uses exogenous variation in incentives to examine...

We formalize the idea that when managers require external investment to expand, higher-skilled firms will be more likely to diversify in equilibrium, even though managers can exploit asymmetric information about their ability to raise capital from investors. We exploit the timing of new fund...

This paper considers the vertical implications of horizontal diversification. Many studies have documented organizational problems following corporate diversification. We propose that selective vertical dis-integration – shifting asset ownership to agents – can mitigate rent-seeking and...

This paper proposes that diversification taxes firms’ existing organizational systems by altering routines, formal contract structures and strategies. I test the proposition that organizational adjustment costs associated with diversification erode incumbent competitive advantage, using novel...

This paper examines how the adoption of mobile information technology networks impact firm strategy and performance in the U.S. taxicab industry. Using a rich, novel firm-level data set from the Economic Census, I test transaction cost economics’ prediction that adoption of mobile IT networks...

We examine how information technology (IT) influences asset ownership through its impact on firms’ and agents’ capabilities. In particular, we propose that when IT is a substitute for agents’ industry-specific human capital, IT adoption leads to increased vertical integration. We test this...

We examine how information technology (IT) influences asset ownership through its impact on firms’ and agents’ capabilities. In particular, we propose that when IT is a substitute for agents’ industry-specific human capital, IT adoption leads to increased vertical integration. We test this...

This paper studies how firms reorganize following diversification, proposing that firms use outsourcing, or vertical disintegration, to manage diseconomies of scope. We also consider the origins of scope diseconomies, showing how different underlying mechanisms generate contrasting predictions...

We develop a formal model to show how integration solves task allocation problems between organizations and test the predictions of the model, using a large and rich patient-level dataset on hospital discharges to nursing homes and home health care. As predicted by the theory, we find that...