Public Affairs, HHH School of
These researchers are using MSI for two projects:
- States across the U.S. have adopted a new form of organization, the benefit corporation, which is defined by its dual objective: the maximization of shareholder profit, while additionally providing some public good. There are no tax or policy benefits conferred to benefit corporations, and the designation is voluntary. If the firm fails to meet either objective, the board of directors may hold the CEO accountable, and likewise, the CEO may evoke success in one objective to make up for losses in the other. While classical economic theory suggests that in large economies the firm should receive no revenue for providing the public good, some proponents of benefit corporations suggest it as a form of branding to consumers. This research project tests if firms see a net sales increase in response to reorganizing as a benefit corporation. The research combines firm level data from the private organizations B-Lab and Mergent, and under a difference in difference regression, finds reorganizing as a benefit corporation does not increase net sales, and at worst marginally reduces net sales.
- Although the employment effects of the minimum wage is thoroughly discussed, econometricians currently rely on the assumption that there is a singular effective minimum wage rate within a state or city. In fact, the federal Fair Labor Standards Act paired with state level policy suggest a vector of possible minimum wages that may be paid out within a state or city based on firm level and employee level characteristics. This project introduces a framework to model a vector of minimum wage tiers, applied to the example of the bunching estimator from Cengiz, Dube, Lindner, and Zipperer 2018. This estimator is expanded by adding an identification of workers allowed to be paid at the lower minimum wage rate. While the scale of any employment effects are minimal, extending this finding to subminimum wage tiers suggests the effects of bespoke minimum wage tiers are dominated by the effects of the most commonly applied wage.