B-School Bulletin: Uber’s London Woes, & More

Uber Underestimated Its Reputation As A Resource

News from London Business School

“Both Uber and London’s tech scene have been dealt a significant reputational blow after one of the fastest growing companies was stripped of its London licence, according to Freek Vermeulen, Associate Professor of Strategy and Entrepreneurship at London Business School.

“’At this stage, I would say the firm has underestimated reputation as a resource. But [London Mayor] Sadiq Khan has also underestimated the damage to London’s reputation,’ he said.

“The shock decision made by Transport for London (TfL), the mayor’s transport authority, sparked an outcry from customers, drivers and government ministers. A petition to reverse the ban has already reached 600,000 signatures, the fastest-growing UK petition this year.

“TfL said Uber, which has 40,000 drivers and 3.5 million customers in the capital, was ‘not fit and proper’ to operate in the city in part due to the company’s failure to report sexual assaults to police.”

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Americans Found To Vastly Overestimate Racial Economic Equality

News from Yale SOM

“Americans across demographic groups tend to severely underestimate the extent of wealth inequality between black and white Americans today, according to a recent set of studies conducted by Yale researchers.

“The studies, published as a paper in in the Proceedings of the National Academy of Sciences, were conducted by Yale professor of psychology Jennifer Richeson, Yale School of Management social psychologist Michael Kraus and psychology doctoral student Julian Rucker GRD ’22. The research compares 1,377 survey participants’ perceptions of race-based economic disparity to pertinent economic data, including recent population surveys. On average, participants overestimated income equality by 25%.”

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How Can Policy Makers Respond To Populist Politics?

News from University of Chicago Booth School of Business 

“Tharman Shanmugaratnam, Singapore’s deputy prime minister and coordinating minister for economic and social policies; JPMorgan Chase International’s Jacob A. Frenkel; and Chicago Booth’s Raghuram G. Rajan spoke with Booth’s Steven J. Davis at the Fourth Asian Monetary Policy Forum, an annual event meant to surface research and insights relevant to economic and financial policy­. The forum, which takes place in Singapore, is co-organized and funded by Chicago Booth, the National University of Singapore Business School, and the Monetary Authority of Singapore.

“When should we normalize monetary policy?

“Davis: We’re going to cover a few topics, and I will open with Jacob Frenkel and ask him to tell us his views about monetary-policy normalization, the outlook for that in the United States and maybe other advanced economies, and in particular what that means for the rest of the world.

“Frenkel: In order to know and to justify where we should go from here, we need to know why we are here. It all started with the financial crisis that erupted in 2008–09. There is a famous story written about 200 years ago by Irving Washington about a Dutch guy named Rip Van Winkle. According to the story, Rip Van Winkle, who lived in the US, went to sleep before the American Revolution and woke up much later after it. The story describes how surprised he was to observe all the changes that had taken place, as the world into which he woke up was very different from the world that he was accustomed to. If Rip Van Winkle were a central banker going to sleep in 2007, prior to the financial crisis, and woke up today, he would not recognize central banking. Central Banking today, 10 years after the crisis, is very different from what it used to be. That’s not a criticism. I only say it has fundamentally changed.”

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Victor K. Fung SM ’66, MIT President L. Rafael Reif, and MIT Professor Charles Sodini at the unveiling of the Hong Kong Innovation Node

MIT Hong Kong Innovation Node Finds Permanent Home

News from MIT Sloan School of Management

“The MIT Hong Kong Innovation Node yesterday (Sept. 24) announced the opening of its permanent, 5,000-square-foot facility, which will serve as a hub for collaborative innovation and entrepreneurship for MIT students, professors, and alumni, as well as others working in Hong Kong.

“The opening ceremony at the facility was attended by Chief Executive of Hong Kong Carrie Lam, as well as alumni and friends of MIT, Innovation Node leaders, students, and startups, and MIT professors who helped launch and guide the Innovation Node’s development.”

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McCombs Has A 47% Female Enrollment Rate, But Finance Is Only 29% Female

 News from UT-Austin McCombs School of Business

“While the McCombs School of Business boasts a 47% female enrollment rate in its undergraduate program, only 29% of finance majors consists of women, according to fall 2017 data from the University.

“The finance major has the lowest female to male ratio in the school, while the marketing major has the highest at 74 percent female, according to the data.

“Finance junior Maggie Fulcher said the finance field is generally male-dominated, which explains the discrepancy between the finance major and other McCombs majors.”

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