Olin Business School

The European Union (EU) will impose trade sanctions on billions of dollars of U.S. goods starting March 1 if Congress fails to repeal an export subsidy ruled illegal by the World Trade Organization (WTO). The export subsidy provision — known as the “extraterritorial income” deduction — gives U.S. companies a big leg up on competitors, but is paid for by the U.S. taxpayer, said William J. Streeter, a professor of international business at the Olin School of Business at Washington University in St. Louis. Streeter says legislation to repeal the export subsidy that has yet to be passed by Congress is projected to save U.S. taxpayers $80 billion over the next decade, but will be offset by lower corporate taxes on the earnings of U.S. firms abroad.

Determining the right pricing strategy can make or break the overall profitability of a firm. One such strategy, dynamic pricing, long practiced in the airline and hotel industries, is showing promise and profitability in the world of retail. When applied to products sold over a short sales season—new toys, skiwear, and the like— dynamic pricing can boost profits for a firm, according to research recently conducted by two professors at the Olin School of Business at Washington University in St. Louis.

Super Bowl XXXVIII is over, but the Super Bowl ads — which cost a cool $2.3 million for a 30-second ad — are still battling it out. For the fourth year in a row, MBA students and faculty at the Olin School of Business at Washington University in St. Louis critiqued and ranked the Super Bowl ads during the big game with veteran advertising executives. This year, the Olin MBA students huddled with senior ad execs from the Leo Burnett agency. But expectations were dashed as most of the Super Bowl ads fell flat. Click here to view the article on the Super Advertising Bowl from the St. Louis Post-Dispatch.

To some people, the Super Bowl is a football game. To others, it’s a marketing derby. “Careers are made, and careers are ended, on these commercials we’re about to see,” said Lewis Williams, a senior vice president, creative director, at Leo Burnett Worldwide Inc., a Chicago-based advertising agency. Williams was addressing more than 100 attendees of the fourth annual “Super Advertising Bowl” at Washington University’s Olin School of Business while Sunday’s game was starting on a giant screen above him. Every year, MBA students, their friends, Washington U. faculty and ad execs like Williams gather to rank Super Bowl ads. During halftime, Advertising Bowl participants vote for their favorite commercials.

Continuing Washington University’s yearlong Sesquicentennial Environmental Initiative, the final set of colloquia will cover significant issues such as tackling childhood lead poisoning, building a sustainable environment in plant sciences, understanding the effect of aerosols in our air; creating ecological and economically viable structures; and understanding how research universities can impact environmental education and public policy.

Martin Luther King, Jr.Jan. 19 marks the national observance of Martin Luther King Jr.’s birthday. Several events are planned on both the Hilltop and Medical campuses to commemorate King’s contributions and legacy. All are free and open to the public.

The John M. Olin School of Business at Washington University in St. Louis has awarded a total of $70,000 in seed investment capital to two startup businesses in its annual Olin Cup entrepreneurship competition. The Olin Cup competition was launched last year with a new emphasis on life sciences, medicine, and technology startups, as well as other student started ventures. The business school’s Skandalaris Entrepreneurship Program sponsors the annual competition. This is the first time seed funding was awarded in the entrepreneurship contest.

SneiderMost retailers are enthusiastic about sales prospects for the holiday season. Estimates for same store sales growth of five to seven percent are expected, according to Martin Sneider, a professor of retailing at the John M. Olin School of Business at Washington University in St. Louis. “These forecasts are far more robust than the numbers posted last year. Estimates for price-driven stores like Wal-Mart and Costco are at the high end of analyst’s expectations,” Sneider says. Meanwhile, online holiday shopping is expected to grow by 20 to 40 percent, he says.

Despite the rejection of a provision to allow prescription drug imports from Canada in the Medicare bill passed by Congress, policymakers are still considering other bills that would allow the drug imports from North of the border. But Jackson Nickerson, a professor of organization and strategy at the Olin School of Business at Washington University in St. Louis, says that allowing the import of drugs from Canada would likely raise prices for both Canadians and U.S. consumers. Nickerson is currently engaged in a major research initiative with the Food & Drug Administration (FDA) and the pharmaceutical industry to improve the manufacturing process for drugs.

Dec./Jan. Business, Law & Economics Tip Sheet