Wednesday, July 15, 2020

 Photo of Letian Zhang

For this post, I interviewed Letian Zhang. Professor Zhang is an Assistant Professor of Business Administration in the Organizational Behavior Unit at Harvard Business School. He is an Economic Sociologist. His research focuses on inequalities in the labor market, with particular attention to those that affect minorities and women.  

I asked him about his paper, “Shaking Things Up: Unintended Consequences of Firm Acquisitions on Inequality and Diversity.”  In this paper, Professor Zhang is interested in how mergers and acquisitions (M&A) affect women and minorities in their workplaces. He interviewed executives who experienced M&A’s first-hand. He also collected data, similar to the US census, but for companies that employ at least 100 people, from 1971-2015. 

When a company is acquired, lay-offs are inevitable. Previous work, like this paper, for example, has shown that, in general, the college-educated, highly skilled workers are at less risk of losing their jobs. It is the lower skilled, or back-office workers who are most often laid off. Professor Zhang measures diversity in the workplace with the proportion of minority managers or of female managers. He found that, compared to firms that did not experience an M&A, 5 years after an M&A, the proportion of minority managers increased by anywhere from about 2 to 5 percent, depending on the minority, and the proportion of female managers increased by about 2 percent. And, interestingly, the effect was stronger when the acquiring firm was more diverse.  

So, this is a nice example of a positive unintended consequence. And Professor Zhang has a very intuitive interpretation of it. While firms engage in M&A’s for financially motivated reasons, Professor Zhang did find in his interviews that executives do value, and want to increase, diversity. However, doing so in the absence of a large restructuring like an M&A is far too costly. So, they wait until an M&A, and take advantage of the opportunity to diversify. So, in this sense the diversity that results from M&A’s may not be fully unintended, but more like an unexpected benefit of M&A’s.

Professor Zhang was careful in his analysis, checking for other possible explanations for his result. For example, maybe the white men in managerial positions were voluntarily leaving after M&A’s. If so, this should happen more during good economic times. But this was not the case in his data. Or, maybe companies are looking to cut costs by eliminating the higher paid white men. If so, this should be happening in the companies in the most dire financial situations. This was also not the case in his data. 

Professor Zhang’s results show that M&A’s provide an opportunity for improved racial and gender equality.  But, keep in mind that they do generally result in layoffs of workers in lower level positions, potentially increasing socioeconomic inequality. No doubt it’s a complex issue --  we can learn from the different ways that different economists, and sociologists, approach and evaluate it.   
I asked Professor Zhang about his related current work. He has work in progress in which he is interested in the effect that the political affiliation of the CEO has on the level of racial inequality within a firm, and how this effect varies. So far he is finding that more liberal CEO’s  tend to value diversity more, and that CEO’s have more influence on the level of racial inequality when the business is changing more strategically.

Let’s talk! I would love to know what you think about this example of unintended consequences. Please submit comments and questions.

Monday, July 6, 2020

 Y. Claire Wang,  MD, ScD

For this post, I interviewed Claire Wang. Dr. Wang is the Vice President of Research, Evaluation & Policy at the New York Academy of Medicine. She is a physician, and she holds a doctoral degree in Health Policy and Decision Sciences. Her research specialties include the field of health technology assessment, which examines the economic costs and benefits of new technologies in the health sector; chronic disease prevention; and obesity. 

We talked about her paper, “COVID-19-Related School Closings and Risk of Weight Gain Among Children.” This paper is co-authored with Andrew Rundle, Yoosun Park, Julie Herbstman, and Eliza Kinsey. In this paper, Dr. Wang and her collaborators discuss a potential important unintended consequence of the school closures in the US during the Covid-19 pandemic. It’s too soon to have data on this, but previous work has addressed the factors at play here. 

First, because of the pandemic, many families are suffering financially and are grocery shopping less often, to avoid exposure to the virus. They are therefore buying more “shelf-stable” foods like pasta and ready-to-eat meals, which have lower nutritional value than foods like fresh fruits and vegetables, which are more expensive and don’t last as long. Second, results of previous studies have shown that childhood obesity increases during the summer, as opposed to during the school year. Over the summer, children become more sedentary, with increased screen time and no regular PE classes (not to mention screen time often means snack time, which often means junk food). 

Both of these factors mean that childhood obesity is likely to increase during Covid-19. And, both of these factors are more likely to matter for children in lower income families. These families are more dependent on the affordability of the shelf-stable foods. They also more often rely on school lunches (and perhaps breakfasts) for a good portion of their daily nutrition. Another risk factor is living in a city, particularly in a small apartment, without access to spaces for physical activity, especially ones large enough for social distancing. In some cities, these spaces do exist, but access has been restricted due to Covid-19.

I asked Dr. Wang about interventions that might reduce the risk of childhood obesity due to Covid-19. She told me that, from the outset, even though they were closed, many school districts made it a priority to keep offering meals (it’s something they do over the summer regularly). They provided grab-and-go options or delivery by school bus. She has other ideas that could help as well. The government could provide a specific subsidy to families, like food stamps, but just for fruits and vegetables. In terms of physical activity, schools need to be thoughtful about how to teach PE online. As a teacher myself, trying to be innovative about teaching online, I’m guessing that there are some thoughtful PE teachers out there with innovative ideas about this! 

Let’s talk! I would love to know what you think about this example of unintended consequences. Please submit comments and questions.

Tuesday, August 27, 2019

Sarah Roberts

Sarah CM Roberts, DrPH

For this post, I interviewed Sarah Roberts.** She is an Associate Professor at the University of San Francisco in the Department of Obstetrics, Gynecology and Reproductive Sciences. The focus of her work is on how policies affect vulnerable pregnant women, including those who use alcohol and drugs, and those who seek abortion.

In this paper, the authors examined the effects of policies that target alcohol use during pregnancy. The types of policies that exist vary by state, and the authors looked at 8 policies altogether. Here I’ll focus on three of them: Mandatory Warning Signs (MWS), Priority Treatment (PT), and Child Abuse/Child Neglect (CACN). MWS states that “notices must be posted in locations where alcoholic beverages are sold. . .” PT allows pregnant women to go to the front of the line for substance use disorder treatment. . .,” and CACN “. . . in some cases, defines alcohol use during pregnancy as child abuse or neglect.”      

One might expect, and hope, that these policies would lead to reductions in adverse outcomes at birth. The authors used several measures of these adverse outcomes. Two examples were low birth weight and pre-term birth. The policies should also encourage women to take advantage of health care more regularly, in particular prenatal care. Their measure of this was called prenatal care utilization. The authors were able to obtain data (1972-2013) from birth certificates in all 50 states. For over half of this time period, they have every single birth certificate (!). For the rest of the time, they have 50-100% of birth certificates. 

The results? At best the finding was that the policies have no effect on birth outcomes and prenatal care utilization; and at worst, instead of leading to reduced adverse outcomes and increases in prenatal care utilization, some of the policies did just the opposite.  For example, living in a state with MWS was associated with 7% higher odds of low birth weight, 4% higher odds of pre-term birth, and 18% lower odds of any prenatal care utilization. The authors calculated that in 2015 there were about 7,000 excess low birth weight and pre-term birth babies due to MWS; and there were 6,000 excess low birth weight and 12,000 excess pre-term birth babies due to CACN policies.

So, what’s happening here? In the case of CACN, it is likely that women who use alcohol during pregnancy fear they will be reported to Child Protective Services by a prenatal care provider and that  they will then lose their children and go to jail. In fact, Professor Roberts previously interviewed pregnant women who use drugs, and the women revealed exactly this fear. In the case of MWS, these signs may contribute to stigma, and hence discourage women from disclosing their alcohol use, and asking for help. Also, some women may fear that they’ve already harmed their baby, and not realize that stopping drinking at any point in their pregnancy can make a difference, and that getting prenatal care can also help. These women miss out on prenatal care, which causes them to miss out on other, related services as well. 

I asked Professor Roberts about how she would design policies differently, given these results. She told me, “people don’t just start drinking once they’re pregnant. . . most of the research about predictors of drinking during pregnancy says that it’s what you were doing before you were pregnant that predicts what you do while you’re pregnant. . . if we can think of this as alcohol policy instead of pregnancy policy, we may be able to better reduce harm for pregnant women.” For example, we know that states vary in how they control access to wine sales. And the authors actually do find, in this paper, that outcomes were better for pregnant women in states with more of this control. So, this is just one example of the type of population-level policy that might lead to improvements for pregnant women. 

I asked Professor Roberts about some of her other recent work. Dr. Katie Woodruff, who works with Professor Roberts, is now interviewing pregnant women about their perspectives on MWS in relation to cannabis use, and in particular in the context of its legalization. 
Let’s talk! I would love to know what you think about this example of unintended consequences. Please submit comments and questions

**Thanks to Samantha Valente for getting me started on this research path. It's so interesting and important! I thoroughly enjoyed it!