In 2021, Assistant Professor Andreas Hagemann developed a new econometric methodology that addresses the complexities of clustered data to enhance the accuracy and reliability of empirical work in economics and related fields. Typical examples of clusters are firms, cities, or states. The central challenge is that units within clusters may influence one another or may be influenced by similar environmental factors in ways that cannot be observed. Empirical researchers know that neglecting to account for clusters can yield results where non-existent effects erroneously appear as highly significant. Hagemann's research agenda developed new tools to address this issue in challenging and empirically relevant scenarios. His work has had a substantial impact on econometric theory and empirical practice. For instance, the methodology he developed is now the standard option for clustering in the canonical implementation of quantile regression in the statistical programming language R.

In 2007, Professor Maxim Sytch published a paper titled "Joint Dependence and Embeddedness: Reshaping Interorganizational Relationships and Exchange Dynamics." In this work, Sytch and his coauthor identify how joint dependence can shape relational embeddedness in inter-organizational relationships. Joint dependence stimulates relational closeness, collaborative action, and fine-grained information exchange between partners. These dynamics improve the performance of inter-organizational exchanges and reduce uncertainty within the relationship. Additionally, they reshape the exchange logic associated with interdependence, moving from an emphasis on power and leverage to a focus on relational embeddedness and mutual collaboration. This work has served as a potent counter to previous organizational and economic theories that associated interdependence with power, leverage, and mutual holdup. However, Sytch demonstrated that joint dependence can foster stronger bonds between exchange partners, leading to more effective exchanges without the looming threat of retaliation. Furthermore, the concept of joint dependence underscores that reducing relational uncertainty does not necessarily require less dependence on that partner. On the contrary, a mutual increase in dependence can foster relational closeness within the exchange, reducing opportunism, enhancing collaboration, and improving the performance of exchange relationships.

In the 1990s, a research team at Michigan Ross, led by Emeritus Professor Claes Fornell, created the American Customer Satisfaction Index. This groundbreaking project included Professors Eugene Anderson and Michael Johnson, as well as Research Scientist Jaesumg Cha and Barbara Everitt, former director of the U.S. Census Bureau. 

ACSI represents a paradigm shift in measuring market performance, offering a more complete view of firms, industries, and economies and treats customer satisfaction as a latent construct connecting expectations, perceived quality and perceived value, through customer satisfaction, to customer voice and loyalty. For the past three decades, ACSI has catalyzed a wealth of peer-reviewed research in marketing and business. Empirical studies consistently find ACSI positively associated with profitability, cash flows, stock returns, credit ratings, positive earnings surprises, revenue, gross margins, return on investment, cash flow stability, and operating margins. Greater ACSI is also associated with lower cost of capital, cost of debt, and selling costs. At a macro level, ACSI is found to be predictive of gross domestic product. 

Published research by the ACSI team enjoys wide recognition, garnering more than 100,000 citations. Additionally, ACSI-related research has played an outsized role in establishing customer satisfaction as an essential metric within firms' management information systems, priority setting, and key performance indicators.

In 1984, former faculty member Birger Wernerfelt introduced a paradigm shift in business strategy with his paper "A Resource-Based View of the Firm." Prior to this transformative work, the discourse on business strategy was predominantly centered around external market factors and competitive forces. 

Wernerfelt challenged this conventional wisdom by presenting the argument that a firm's internal resources, ranging from tangible assets like machinery to intangible assets like reputation, could be the key to creating a competitive advantage. This theory, known as the Resource-Based View, asserts that for resources to offer a firm sustained competitive advantage, they must be valuable, rare, and difficult to substitute or imitate. 

The RBV has had profound implications and has changed how firms undertake strategic planning by emphasizing the importance of leveraging internal assets for competitive advantage. Wernerfelt's paper has been cited in thousands of academic publications and is now a staple in business school curricula worldwide.

In her research published in the American Economic Review, the Review of Economics and Statistics, the Journal of Human Resources, Health Affairs, and other outlets, Professor Sarah Miller has used quasi-experimental methods to evaluate whether receiving improved access to health care in utero, in early childhood, and throughout childhood improves outcomes in adulthood. Miller and her co-authors have found that children who have received eligibility for health insurance through the Medicaid program have improved outcomes on a number of dimensions, both in terms of health and economic outcomes. Additionally, they found that the children of those children who had better access to healthcare in childhood were healthier at birth. This suggests a cycle in which investing in children's health today can have multigenerational benefits that allow the government to fully recoup the cost of its initial investment in the form of higher tax payments and lower spending on welfare programs. Miller's research has been discussed in numerous high-profile news outlets and has strongly impacted how academics and policymakers view investments in children. Furthermore, her papers have been cited nearly 500 times.

Sensory marketing is a relatively new and growing field of marketing that Professor Aradhna Krishna pioneered in the early 2000s. Krishna saw that there were disparate fields of study on senses, but there was no cohesion between these fields. She brought all these sub-fields together under the umbrella of sensory marketing and organized the first conference on it in 2008. She then wrote two books and dozens of scholarly articles on the subject to make the field grow. And the field did grow both in academia and in practice -- enough for Harvard Business Review to do a lead Ideawatch article on it featuring Krishna as the world's foremost expert on the topic. Krishna has defined "sensory marketing" as marketing that engages the consumers' senses and affects their perception, judgment, and behavior. Krishna continues to publish important, scholarly articles on the topic. She also started the Sensory Marketing Lab at Michigan Ross, which attracts PhD students and post-docs from around the world.

Michigan Ross is known for being one of the first places to promote and provide rigorous evidence contrary to the efficient market hypothesis. The work of Professor Victor Bernard, a faculty member from 1982-1995, played a huge role in the beginnings of literature on market inefficiency. His work in valuation and fundamental analysis was the first to provide evidence that investors could not fully process information in earnings releases. The inefficient markets argument was further supported by the work of Professor Richard Sloan, a faculty member from 1997-2007. Bernard demonstrated that market participants treat the two basic components of accounting — cash and accruals — in an irrational way when making their valuation of corporate securities. This behavior became known as the "accrual anomaly." Bernard's work twice won the Notable Contribution to the Accounting Literature Award. 

Professor Gretchen Spreitzer received her PhD from Michigan Ross in 1992. Her work on empowerment, stemming from her Michigan Ross dissertation, has set the foundation for a new understanding of the employee experience. Instead of capital that organizations needed to control, empowerment brought forth the idea that employees thrive when they are given the freedom and autonomy to do their work autonomously. This pioneering work ushered in a new era of research and a fundamental shift in how organizations view their relationship with employees.

The Affordable Care Act represented arguably the largest change in federal health policy since the creation of the Medicare and Medicaid programs in the 1960s, expanding coverage to approximately 40 million people who were previously uninsured. In a series of papers published in the Quarterly Journal of Economics, New England Journal of Medicine, AEJ: Applied Economics, Journal of Public Economics, and other outlets, Associate Professor Sarah Miller and her co-author Dr. Lara R. Wherry quantify the impact of this policy on the predominantly low-income population who gained coverage as a result of the reform's resultant changes in Medicaid eligibility. Their work has shown that 1) low-income adults who gained coverage through the ACA Medicaid expansions experienced reduced mortality rates and that the failure of some states to adopt these expansions cost approximately 4,800 deaths per year in those states; 2) low-income adults who gained coverage through these expansions experienced improved access to medical care and improved financial outcomes; 3) the expansion of coverage to these individuals did not crowd out care provided to population who were unaffected, such as those in Medicare. This work has garnered over 1,800 citations and has been discussed in numerous high-profile media outlets and policy documents.

Franchised chains have an outsize influence on the economy: firms involved in a variety of business activities are organized as franchised chains and they employed over 9.6 million workers in the United States in 2017 according to the Census Bureau. Professor Francine Lafontaine's pioneering work on franchising shows that the success of this organizational form across various sectors results from the franchisor and franchisee specializing in the activities they are best suited to. Specifically, the franchisor specializes in creating and supporting the business format and brand, where scale is especially beneficial, and the franchisee optimizes operations locally, where their knowledge and efforts are particularly valuable. Lafontaine's work in this area has informed the choices that franchisors make and the nature of the contracts they use, and also the debate over legislation that aims to address the alleged shortcomings of the franchising organizational form. 

Her work suggests caution in developing potential public policy changes as consumers, existing and potential franchisees, as well as their employees stand to lose in the long term if franchising becomes less competitive as a form of organization. More broadly, Lafontaine's research has made seminal contributions to our understanding of how firms interact with each other in the process of procuring inputs or distributing their products, and prompted her appointment as Director of the Bureau of Economics at the FTC in 2014-15. In particular, her research has shown that factors driving vertical integration and vertical contracting can be very different from those motivating horizontal mergers, so analyses of vertical mergers should start from a different premise compared to analyses of horizontal mergers. Her detailed analyses of franchise contract terms, as described in her book The Economics of Franchising, provide further reasons why, in her view, the rule of reason continues to be the right approach in antitrust cases involving vertical restraints.

The paper "Value of Information in Capacitated Supply Chains" by Professor Roman Kapuscinski and his co-authors was published in Management Science in 1999. This paper contributed significantly to the understanding of how information sharing impacts the performance of supply chains. Specifically, this paper turned on its head the notion that information would be most valuable in settings where capacity is tight, when the uncertainty of demand is huge, and when the costs of unsatisfying demand are very high. The paper uses careful, rigorous analyses to reveal when information is most valuable and how the value depends on many interrelated factors. Providing an innovative analytical model, Kapuscinski and his colleagues demonstrated when and how the sharing of demand information could remarkably enhance inventory management and order fulfillment for capacity-constrained supply chains. The subsequent literature in operations management has heavily referenced this pioneering work, leading to the development of practical strategies for improving supply chain efficiency through information sharing. Further studies have explored different facets of information sharing in diverse supply chain settings and have considered more complex forms of information, extending the paper's impact in many directions within operations. 

The Carson Scholars Program at Michigan Ross is a signature feature of the Ross BBA Program and a result of the vision and generosity of David Carson, BBA '55. Carson, the former president of People's Savings Bank in Connecticut, was recognized by Forbes as one of the 500 most powerful people in the corporate United States. Based on his experiences throughout his career, Carson realized that future business leaders should understand how government works to develop effective corporate strategies for participating in the public policy arena. As a result, CSP enables Ross undergraduates to augment their on-campus learning with study in Washington, D.C., where they meet with elected officials, government experts, industry leaders, issue advocates, and lobbyists. Since its foundation in 2005, the program has enabled more than 1,000 alumni to learn about the public policy process from these experts.

From 2000 to 2005, Professors C.K. Prahalad and M.S. Krishnan co-authored several papers on concepts related to how the emergence of digital technologies was transforming business models. From 2005 to 2008, they co-authored the book New Age of Innovation, which introduced the concept of N=1;R=G business model framework. The basic argument was that given the new capabilities emerging from digital technologies, the structure of business models was in the midst of a transformation across industries. They claimed that business models will shift from mass production of products or services to businesses co-creating personalized experiences for one customer at a time. They called this N=1 business model, i.e., businesses will operate on a sample size (N) of one. They argued that to orchestrate this personalized experience for one customer at a time, businesses will not own all resources but will connect with resource partners across the globe (Resources=Global or R=G), and these partners could be big organizations, small businesses, entrepreneurs, or even individuals. They called this business model N=1;R=G. They argued that digital technology was at the center of enabling these capabilities, and no industry will be immune to this change. They presented more than 80 examples in the book. The rest of the book was on the capabilities companies needed to build inside their organizations to compete as an N=1 business. Their primary thesis identified the significant role of software in orchestrating the personalized N=1 experience in an ecosystem of partners and the criticality of the right capabilities in the information architecture and social architecture of companies to thrive in this competition of N=1;R=G ecosystem business models.

While concerns regarding corporate financial misreporting have persisted since the early 1900s, there were no rigorous methods that academics, market participants, and regulators could use to assess the accounting quality or the potential for financial misreporting when looking at a set of financial statements. Faculty members Patricia Dechow, Ilia Dichev, and several of their co-authors in the Michigan Accounting group developed several widely used models that allow users to assess the financial reporting quality of a set of financial statements and, more importantly, allow users to detect potential earnings management. These models and adaptations of these models continue to be used today, both in research and in accounting courses.

Professor Kenneth Lieberthal was a pioneer in the practice of business school professors contributing their knowledge in public service to society. Lieberthal served as the senior director for Asia for the U.S. National Security Council during the years 1998-2000. 

During that same time, Lieberthal was also special assistant to President Clinton for National Security Affairs. His core academic research findings included a seminal analysis of China's bureaucratic system, which featured a nuanced and careful delineation of the fragmented nature of China's political system in the late 20th century. 

Lieberthal's research was able to explain why China, during that era, had weak policy implementation at times because of the fragmentation in its bureaucratic system. He was known for introducing U.S. policymakers to a nuanced and careful understanding of the Chinese governmental system and how it functions.

As the worlds of trade and culture were globalized in the 1980s, consumers worldwide saw standardized global brands enter and grow in their local markets, displacing local brands that had been dominant for decades. But what were consumers seeing in these global brands, and why were consumers switching to them? How could local brands fight back? These timely and important questions were addressed in a series of research papers by Michigan Ross Professor Rajeev Batra and his co-authors from 1999 through 2019. They showed that if consumers perceived brands as being global, they assumed these brands were of higher quality, capable of bestowing more prestige and status to their buyers, and would bring these buyers closer to the imagined lifestyles of consumers in the home countries of these brands. These papers have been cited over 6,000 times, have been nominated for and won multiple best-paper awards in journals and societies of international marketing, and have been included in lists of the 10 papers in the last 30 years that have made the most contribution to the international marketing literature. Today, as the lure of globalization seems to be receding and local brands seem to be winning again, this work highlights the tensions and trade-offs at play.