What's in a name? Hotelling's valuation principle and business school namings

Timothy R. Burch, Vikram Nanda

Research output: Contribution to journalReview articlepeer-review

3 Scopus citations

Abstract

Almost 50 prominent business schools were "named" in the 1980s and 1990s, in exchange for sizable donations. We view this as an interesting example of the exhaustible resource market examined in Retelling (1931). Schools face a trade-off that involves a possible benefit from waiting (to receive a larger gift) against the (opportunity) cost of delay. We find schools wait to accept a name until the annualized rate of increase in offered gifts is around 5%, in keeping with Hotelling's principle and a market in school names. We also find, generally, lower-ranked schools receive smaller gifts and delay their namings longer.

Original languageEnglish (US)
Pages (from-to)1111-1135
Number of pages25
JournalJournal of Business
Volume78
Issue number4
DOIs
StatePublished - Jul 1 2005

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics
  • Statistics, Probability and Uncertainty

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