We develop a theory of how the intersection of business goals and the pursuit of "higher purpose" — something that produces a non-pecuniary social benefit valued by the principal and the agent — affects economic outcomes. Two types of principals — those pursuing only wealth maximization...

"Two distinguished scholars offer eight steps to help organizations discover and embrace an authentic higher purpose--something that will dramatically improve every aspect of any enterprise, including the bottom line. What does a lofty notion like purpose have to do with business basics like the...

We develop a model in which there are firms and employees who care about profit-sacrificing higher purpose (HP) and those who do not. Firms and employees search for each other in the labor market. Each firm chooses its HP investment. When there is no social pressure on firms to adopt a purpose,...

"This third edition of Competing Values Leadership serves as the key source for understanding and using the Competing Values Framework, one of the most widely used and highly cited frameworks in the world for understanding human behavior, leadership, and organizations. The authors of the...

We develop a model in which there are firms and employees who care about profit-sacrificing higher purpose (HP) and those who do not. Firms and employees search for each other in the labor market. Each firm chooses its HP investment. When there is no social pressure on firms to adopt a purpose,...

How does organizational higher purpose (HP) affect employee behavior and firm output? We develop an optimal-contracting model which endogenizes HP investment. The model shows that HP dissipates agency frictions, lowers wage costs and elicits higher employee effort. Firm profit is non-monotonic...

Within the Ross School of Business, a debate took place a few years back that continues today regarding the role of business. It was sparked by discussion surrounding a “Positive” Pillar as a part of the school strategy. More of the background can be found in the case, “Emphasizing the...