The Influence of Political Disposition on Investors’ Reactions to Corporate Social Initiatives
We utilize an experimental methodology to investigate investors’ reactions to corporate social initiatives, specifically those related to justice, equity, diversity and inclusion (JEDI), while considering their political dispositions, conservative or liberal. Results of this study indicate that social initiative disclosures significantly influence the investment decisions of liberals in comparison to those of conservatives. Supplemental analyses reveal that investors’ belief in equality for all mediates the effect of JEDI initiatives on their decisions, but this holds only for liberals. The investment decisions of conservative investors, on the other hand, are primarily driven by their belief in a corporate focus on profit maximization. On average, conservatives present undetached reactions to social initiative disclosures, but those with a high resistance to change in the social order react to JEDI initiatives adversely. Our study’s findings suggest that future research should control for individual political dispositions when investigating the influence of social initiatives related to non-financial disclosures on investor decisions. This research also provides practical implications for firms with social initiatives or those planning to incorporate them into their internal policies and practices.
Speakers: Ikseon Suh (Ph.D. Associate Professor; Department of Accounting Lee Business School, University of Nevada, Las Vegas).
Organized by: Irene Comeig (Research Fellow at the Woman and Public Policy Program at Harvard University, Harvard Kennedy School).
Sponsors: RCCHU; Harvard University.
Risk Aversion and Present Bias in Marital Economics: Designing Insurance for Divorce-Related Financial Risk
This study explores the concept of divorce insurance as a mechanism to mitigate the financial risks associated with marital dissolution, particularly focusing on the roles of risk aversion and present bias in marital economics. It addresses the gender inequality in earnings and the economic vulnerabilities women may face following divorce due to traditional gender-based divisions of labor. The proposed insurance model features long-term commitment requirements, flexible redemption options, and just-in-case coverage, designed as a voluntary market-based solution that does not penalize or reward divorce. The research investigates how such insurance can counteract decision-making biases in long-term contracts like marriage, potentially acting as a behavioral nudge to influence relationship decisions long before divorce. Future directions include experimental designs to measure the impact of divorce insurance on pre-divorce behaviors, expectations, and financial planning, as well as its potential integration into employer benefits packages to enhance financial security and employee wellbeing.
Speakers: Irene Comeig (Harvard University, HKS, the Women and Public Policy Program; Real Colegio Complutense, Harvard; ERICES and University of Valencia)
Sponsors: RCCHU; The Woman and Public Policy Program (WAPPP) at Harvard University, Harvard Kennedy School.
Organized by: Irene Comeig (Research Fellow at the Woman and Public Policy Program at Harvard University, Harvard Kennedy School).
LOCATION:RCCHU Conference Room STATUS:CONFIRMED DTSTART:20250617T200000Z DTEND:20250617T220000Z END:VEVENT END:VCALENDAR