Nordlund, James Chandler (2017-06). Firm Policy in a Multipartite Economy: Sources of Strategic Investment, Risk Discovery, and Input Valuation. Doctoral Dissertation.
Thesis
This dissertation studies how the interconnectedness embedded in a firm's economic environment shapes a variety of corporate policies, including (1) strategic investment, (2) discovery of sources of risk and its dissemination to shareholders, and (3) valuation of labor inputs utilized in production. I frame the firm's economy as a multipartite graph, wherein corporate directors, executive officers, companies, and product spaces represent different classes of nodes. Section 1 discusses competitive interaction of company nodes induced by shared connections to product space nodes. I examine conditionally random shocks to a firm's financial flexibility and measure the strategic investment responses by rival firms sharing a common product space via a causal indirect treatment effect estimator novel to the finance literature. Section 2 then looks to information flow across companies through shared connections to director nodes. I study the permeation of conditionally random cybersecurity events across a director's current board appointments to investigate the role of director human capital in monitoring, identifying, and disclosing sources of firm risk. Section 3 focuses within a company instead of looking across companies, and is coauthored with Shane Johnson, Adam Kolasinski, and Steve Boivie. We investigate the interaction of executive officer nodes within a firm by analyzing the effect of a chief executive officer's narcissism on his or her valuation of employee human capital.
