Haas NewsWire

Haas NewsWire, October 18, 2004

Improving MBA Job Market Boosts 2004 Graduates and Current Students

Berkeley MBA

Graduates of the Full-time MBA class of 2004 were able to take advantage of the improving job market this year with increased numbers of job offers, earlier job offers, and higher salaries. Over 92% of job-seeking graduates had received offers within three months of graduation. The trend appears to be continuing for current students this fall with more firms recruiting on campus for a greater number of positions.

"The employment report for the class of 2004 shows once again that Berkeley MBA students are able to land outstanding jobs in both traditional and non-traditional markets," says Ilse Evans, executive director for career services and initiatives with the Chetkovich Career Center. "While technology, financial services, consulting, and consumer/retail industries account for about three-quarters of the class, healthcare/biotech and real estate are increasingly attractive to our students."

Berkeley MBA students have always pursued a variety of career paths upon graduation, and the full-time class of 2004 was no exception. Technology and financial services were the top industries of choice among Haas graduates this year, representing 24% and 21% of the class respectively. Over 15% of the graduates entered the consulting field and 15% entered the consumer products/retail sector. Healthcare/biotech (9%) and real estate (7%) also continued to be popular fields.

Functionally, the graduates continue to focus in the areas of finance (27%), marketing (24%), general management (19%), and consulting (17%).

The average base starting salary was $88,234, an increase over last year. The average signing bonus was $12,824. Says Evans, "More than half of job-seeking 2004 graduates reported receiving signing bonuses."

Top hiring firms for both full-time positions and summer internships reach across a spectrum of industries, and include McKinsey & Co. (16 positions), Gap Inc. (13 positions), Wells Fargo Bank (11 positions), Yahoo! (8 positions), Citigroup, IBM, Blue Shield of California, Boston Consulting Group, Deloitte, Johnson & Johnson, Lehman Brothers, Microsoft, Roche Diagnostics, and more.

"We've seen a number of new firms on campus for the fall '04 recruiting season that we are quite excited about," says Evans. The new companies include Yahoo!, Amazon.com, Shea Homes, Home Depot, Booz Allen Hamilton, the Tiber Group (consulting), RPOptions (consulting), Jeffries (investment banking), AIG, and the Perseus Group (investment banking). "We're also seeing a number of companies come back after a year or two absence, particularly in banking," continued Evans. "These include Goldman Sachs, Putnam Lovell, Deutsche Bank, and Montgomery & Co."

There has also been a rebound in recruiting by consulting companies. "For this fall 2004, we've see the return of consulting firms large and small to on-campus recruiting," says Evans. "Also, companies are recruiting for new and different divisions and positions. For example, Clorox, Gallo, Accenture, ChevronTexaco, and Booz Allen Hamilton are all recruiting for multiple positions in new departments this year."

For more information, including the complete Employment Report, please visit http://www.haas.berkeley.edu/careercenter/employment_reports.html.

MFE Students Land Top-Notch Internships at Finance Firms Around the Globe

Students in the Master's in Financial Engineering Program (MFE) are in strong demand this fall, as 91 percent of the MFE students have been snapped up by firms in New York, Boston, London, Hong Kong, and across the Bay Area for internships over the three-month winter break.

The largest group of MFE students will be going to Barclays Global Investors, which hired eight MFE interns -- five in the San Francisco office and three in the London office. First-time recruiter, WR Hambrecht, hired six interns for its San Francisco office.

Additional firms working with Haas MFE interns this winter include Barclays Capital, BNP Paribas, Citigroup Global Markets, Goldman Sachs, Morgan Stanley, and Nicholas Applegate.

This year more MFE students have secured internships in investment banking and trading positions than in previous years, according to Linda Kreitzman, MFE program director, who also notes an up tick in MFE internships with hedge funds. She attributes the shift to improved economic conditions and the MFE internship partners' positive experience with previous interns.

"The quality of the hiring firms and their clear efforts toward developing challenging and substantial projects for the interns reflects industry's respect for the Haas MFE program, and makes the program even stronger going forward," says John O'Brien, executive director of the MFE program.

This year's MFE students, who began coursework for the one-year program in April, will put new-found knowledge into practice on real-world projects during the 10- to 12-week internships. The internships pay an average of $5,500 a month and take place over the MFE program winter break, from mid-October to mid-January.

"The internship program allows the students to acquire relevant practical experience before entering the job market, and to demonstrate the skills they have acquired during the program," says Kreitzman. "After completing 75% of the coursework, our students are ready to make an immediate impact on the firms in the areas of valuation, pricing, trading, risk management, project evaluation, and portfolio management decisions." The internships not only hone student skills, but also give financial firms an early look at MFE graduates who will be available upon completion of the program in March 2005.

Two of this year's interns are Kunal Kanodia, MFE 05, who will work on developing, testing, and implementing a financial model for Barclays Capital in New York, and Yadong Li, MFE 05, who will work on a financial model in the credit derivatives department for the US Investment Bank's Quantitative Credit Analysis at Morgan Stanley in New York.

Kreitzman oversees the placement process and works diligently to help MFE students and financial firms make the right match. Firms interested in hiring an intern submit a topic, short-term project, or skill set they need to the MFE program and qualified students reply with a one-page work proposal for the project and a resume. For more information on recruiting MFE students, visit http://mfe.haas.berkeley.edu/recruiting.html. To contact Kreitzman, call 510-643-4329 or send e-mail to lindak@haas.berkeley.edu.

New Haas Economist Explores Effects of Worker Treatment on Product Quality

Employees who are disgruntled over wages can harm firms financially and may even pose a threat to public safety if their irritation translates into poor workmanship and defective products, says Haas School Assistant Professor Alexandre Mas. Mas, who bases his work on several years of research into labor unrest and worker performance, joined the Haas Economic Analysis and Policy group this fall.

The case of Bridgestone/Firestone, which refused to negotiate flexibly with its workers' union in several plants between 1994 and 1996, was particularly dramatic, Mas discovered. By analyzing consumer complaints, claims for compensation for property damage or personal injuries, and engineering test data, Mas and co-author Alan Krueger determined that the quality of the tires produced in one of the plants involved in the labor dispute was significantly lower than that of tires produced in plants unaffected by the strife. Defective tires from the affected plant resulted in 70 automobile deaths, a highly negative media response, the recall of 14 million tires, and a loss in company stock value of $9 billion in four months.

Mas teased out similar dynamics in cases of arbitration between police unions and city governments in New Jersey. "When arbitrators voted against union contracts in favor of those proposed by the city, arrest rates declined by 10 percent, meaning that police were not working as hard," he says. "Such conditions can have a significant impact on crime."

Finally, Mas studied the effect of ongoing contract disputes between the United Auto Workers union and Caterpillar, the world's largest manufacturer of construction machinery, between 1991 and 1998. To quantify how worker discontent arising from the situation may have affected performance, he examined resale prices of Caterpillar equipment during this period and found that equipment produced in the US during the labor dispute sold at auction for 4 percent less than equipment produced prior to 1991 and after 1998 -- even though similar non-American models did not experience this change in prices.

"The resale price of a machine reflects how well it will run, so this decline indicates that equipment made during this period was of poorer quality than equipment made before the contract problems started," Mas explains. By carefully ruling out other potential explanations for the dip, he determined that domestic employees simply were building inferior equipment as a result of their discontent with the company. Although the situation did not financially affect Caterpillar directly, he notes, the 4 percent differential was equivalent to a quarter of a billion dollars in lost service flows resulting from less reliable equipment.

Mas earned his Ph.D. and MA in economics from Princeton University, and his BA in economics and mathematics from Macalester College.

Register Now for November 5 Financial Reporting Conference

Current issues such as compliance with the Sarbanes-Oxley Act and how to handle equity-based compensation, such as stock options, will be the focus of the fifteenth annual Conference on Financial Reporting, being held Friday, November 5, at the Hyatt Regency San Francisco Airport Hotel in Burlingame from 8:30 a.m. to 5:00 p.m.

The conference is sponsored by the Haas School's Center for Financial Reporting in Management. For the first time this year, CFRM will present the Berkeley Award for Distinguished Contributions to Financial Reporting. The winner will be announced at the conference.

Robert Herz, chairman of the Financial Accounting Standards Board (FASB), will give the morning keynote. The luncheon keynote speaker will be Mary Barth, board member of the International Accounting Standards Board (IASB), professor of accounting, and senior associate dean for Academic Affairs at Stanford University's Graduate School of Business.

The conference will bring together accounting standard setters, enforcement officials, corporate financial executives, and professional and academic accountants. Conference panelists from the US Securities and Exchange Commission (SEC), Deloitte & Touche, KPMG, PricewaterhouseCoopers, and more will address hot topics.

For a complete program schedule and to register visit http://groups.haas.berkeley.edu/accounting/cfrm/conferences/15annual/index.html or call 510-642-6334.

Bring on the Big Game, the Blues, and the Barbecue, Nov. 20

Come celebrate with fellow Haas School alumni at a pre-game tailgate party from 10:30 a.m. to 12:30 p.m. in the Haas courtyard, before the Cal Bears take on the Stanford Cardinals at the Big Game November 20, in Berkeley's Memorial Stadium.

An alumni band will play the blues and traditional BBQ fare will hit the plates during this pre-game tradition. Current kick-off time is 12:30 p.m., but may shift if the Big Game is picked up by a television network.

To register for the Haas pre-game BBQ, visit http://www.haas.berkeley.edu/alumni/biggame. For tickets to Big Game, call Cal Athletics at 1-800-GOBEARS.

Faculty News

Professor Williamson Honored by Valencia University
Oliver Williamson, professor emeritus in the Business and Public Policy Group, will be awarded the degree of Doctor Honoris Causa from Valencia University in Spain on October 22. While there, he will also speak as part of a program on Transaction Cost Economics.

Staff News

Alysia Nero to Provide Support for Professors
Alysia Nero joined the Haas School on October 4 as one of eight faculty assistants providing administrative support to the Haas faculty. Previously Nero worked for Peralta Community College District in Oakland, as the staff assistant for the Information Technology Department. Nero has lived in the Bay Area all of her life, and is the mother of two boys, ages 19 months and 13 years. She enjoys reading and participating in her son's track meets and baseball and football games.
e-mail: anero@haas.berkeley.edu
phone: 510-642-5588
office: F470

Haas in the News

High gas prices kept Severin Borenstein, the E.T. Grether Professor of Business Administration and Public Policy in the news:
+ Borenstein commented in an October 13 San Francisco Chronicle article titled "Punishment at the Pump" on a likely price surge in gas costs next summer, even if winter prices drop some. For full text:
+ He commented on the impact of refinery capacity on prices in an October 13 Contra Costa Times article titled "Gas Prices Near Record." For full text:
+ In the San Jose Mercury News on October 11 he commented on the futures market for oil in an article titled "$1.99 a Gallon may be History." For full text: http://www.mercurynews.com/mld/mercurynews/news/world/9889884.htm.
+ The North County Times cited a study by Borenstein in an October 11 article titled "Gas Prices Set 2004 Record." For full text: http://www.nctimes.com/articles/2004/10/12/business/news/20_45_5310_11_04.txt.

On October 12, the Sacramento Bee included mention of the Haas School in an article about the business school rankings by the Economist Intelligence Unit titled "UCD Cracks Top 50 List in MBA Program Survey." For full text:

Janet Yellen, president and CEO of the Federal Reserve Bank of San Francisco and the Eugene E. and Catherine M. Trefethen Professor of Business Administration, commented on the current account deficit in an October 12 Market News International article titled "Repeat: Analysis: C/A Worry Prompts Greater Fed Openness on FX."

Adjunct marketing professor Peter Sealey's appointment to the board of directors at Reply, Inc., was mentioned in an October 11 East Bay Business times article titled "Reply Adds to Board of Directors." For full text:

Dean Tom Campbell was mentioned in a story on Governor Schwarzenegger's "all-star" Council of Economic Advisers in an October 11 San Jose Mercury News article titled "Governor's Team Tackles the Economy." For full text:

The Haas School's ranking as the #10 school for Technology/Telecommunications/Internet by the 2004 Wall Street Journal/Harris Interactive Business School Survey was cited in Computerworld on October 11 in an article titled "Ranking Schools for Business and IT." For full text:

Cynthia Kroll, senior regional economist for the Fisher Center for Real Estate and Urban Economics, commented on the unpredictability of California's housing market in an October 10 Korea Times article titled "US Property Market to Cool Off." For full text:

Yellen was quoted in the International Herald Tribune in an October 9 article titled "On Rates, How Much and How Fast? With Interest." Yellen commented on interest rates and central banks.

A paper by James Heyman, a Haas Ph.D. candidate in the Marketing Group, and Dan Ariely of MIT, was reviewed in the Editor's Choice: Highlights of the Recent Literature section of Science on October 8. The paper will appear in an upcoming issue of Psychological Science.

Kroll was quoted on California's housing market in an October 8 Oakland Tribune article titled: "House Prices may Rise in 2005." For full text:

An October 7 San Francisco Chronicle article titled "Big Debate: Cal, Stanford Scholars Tackle Economy" mentioned former Dean Laura Tyson and Janet Yellen. The mention was part of a summary of Stanford economists who served in the Reagan administration compared to the number of UC Berkeley appointees to the Clinton administration. For full text:

Happening at Haas

"The Internet-Still the Land of Opportunity"
Thursday, October 21
6:30 p.m. to 8:30 p.m.
Arthur Andersen Auditorium
For more information, visit http://entrepreneurship.berkeley.edu/oct04.asp.

Tuesday, October 26
6:00 p.m. to 8:30 p.m.
Wells Fargo Room
This event is an opportunity to hear first-hand what the competition is about and network with other entrepreneurs from all over the Bay Area. The organizers will go over the competition rules and key dates, and finish the event with a question-and-answer session. Appetizers and refreshments will be served.
For more information about the business plan competition, please visit
http://bplan.berkeley.edu/ or send inquiries to bplan@haas.berkeley.edu.

"Silicon Valley Management Strategies" by Aart de Geus, Chairman and Founder, Synopsys
Wednesday, October 27
4:00 p.m. to 6:00 p.m.
Wells Fargo Room
Few individuals in Silicon Valley can match Aart de Geus' track record for executive leadership and technological innovation. He has led Synopsys from formation in 1985 to its current leadership position in a $10 billion industry.

Friday, November 5
8:30 a.m. to 5:00 p.m.
Hyatt Regency San Francisco Airport Hotel in Burlingame
For a complete program schedule and to register, call 510-642-6334 or visit


"It Could Have Been Better: The Effects of Communicating Counterfactual Thoughts on Impression Formation"
Elaine Wong, University of California, Berkeley
Wednesday, October 20
4:00 p.m. to 5:30 p.m.
Room C220
For more information, contact Deborah Houy at houy@haas.berkeley.edu.

"Was There a NASDAQ Bubble in the Late 1990s?"
Lubos Pastor, University of Chicago
Thursday, October 21
4:10 p.m. to 5:40 p.m.
Room C210
For more information, contact June Wong at june@haas.berkeley.edu.

Raquel Fernandez, New York University, London School of Economics
Thursday, October 21
4:00 p.m. to 6:00 p.m.
Room C325
For more information, contact Anita Stephens at stephens@haas.berkeley.edu.

Leif Nelson, New York University
Friday, October 22
4:00 p.m. to 5:30 p.m.
Room C250
For more information, contact Laura Gardner at Lgardner@haas.berkeley.edu.

"Has SARS Infected the Property Market? Evidence from Hong Kong" by Grace Wong, Princeton University
Monday, October 25
12:30 p.m. to 2:00 p.m.
Room C135
For more information, contact Thomas Randle at randle@haas.berkeley.edu.

"Doing the Right Thing and Making the Best Decision: A Legitimacy Based Theory of Organizational Team Effectiveness" by Randall Peterson, London Business School
Wednesday, October 27
4:00 p.m. to 5:30 p.m.
Room C220
For more information, contact Deborah Houy at houy@haas.berkeley.edu.

Elie Ofek, Harvard University
Thursday, October 28
4:00 p.m. to 5:30 p.m.
Room C250
For more information, contact Laura Gardner at Lgardner@haas.berkeley.edu.

"Financial Claustrophobia: Asset Pricing in Illiquid Markets" by Francis Longstaff, University of California, Los Angeles
Thursday, October 28
4:10 p.m. to 5:40 p.m.
Room C210
For more information, contact June Wong at june@haas.berkeley.edu.

Tim Feddersen, Northwestern University
Thursday, October 28
4:00 p.m. to 6:00 p.m.
Room C325
For more information, contact Anita Stephens at stephens@haas.berkeley.edu.

"What Do We Look at in Print Ads? A Review of Research on Visual Attention Using Eye-Tracking" by Michel Wedel, University of Michigan
Friday, October 29
4:00 p.m. to 5:30 p.m.
For more information, contact Laura Gardner at Lgardner@haas.berkeley.edu.

Alumni Events

Professional Development Program: Monetary Policy and Economic Outlook presented by Janet Yellen, president and CEO of the Federal Reserve Bank of San Francisco and the Eugene E. and Catherine M. Trefethen Professor of Business Administration.
Thursday, October 21
3:00 p.m. to 5:00 p.m.
Sheraton Palace Hotel, 2 New Montgomery St., San Francisco
For more information, visit

"The High Cost of Cheap Gasoline and The Implications of Relying on Oil From Unstable Regions," presented by Severin Borenstein, the E.T. Grether Professor in Public Policy and Business Administration
Thursday, October 21
6:30 p.m. to 9:00 p.m.
Palo Alto Sheraton, 625 El Camino Real
For more information, visit
http://www.acteva.com/booking.cfm?bevaid=75468 or contact David Hansen at 510-498-8264.

San Francisco Bar of the Month
The Slanted Door, 1 Ferry Building # 270, San Francisco
Thursday, October 21
6:30 p.m.

Trefethen Vineyards Wine Tasting
Thursday, November 4
6:15 p.m. to 9:30 p.m.
Gardens on Glendon, 1139 Glendon Ave., Los Angeles
Cost: $49 per person through October 22, $55 after October 22, $60 at the door
Register on-line:
Join fellow alumni for this unique opportunity to engage with Trefethen Vineyards, one of the nation's foremost authorities on estate wine making. Our event will take place at Gardens on Glendon, one of Los Angeles' premier restaurants. The event will include an extensive tasting of four different wines and a three-course gourmet dinner with choice of entree.
For more information:

Join the East Bay Chapter of the Haas Alumni Network for an exclusive reception and tour of the Oakland Raiders headquarters.
Tuesday, November 9
6:00 p.m. to 8:00 p.m.
The Oakland Raiders, 1220 Harbor Bay Parkway, Alameda
Hosted by Haas alumnus, Marc Badain, MBA 01, this behind-the-scenes event will give you a chance to mix and mingle with fellow Raiders fans, learn a little more about the business side of football and take a tour of the office and training facilities. The headquarters feature practice fields, a full-featured weight room, locker room, player meeting rooms, an auditorium, a state-of-the-art television studio and offices.
Please sign up by Friday, October 29. If you have any questions, send e-mail to Marina Gracias, BS 80, MBA 99, at mgracias@yahoo.com.
To register, visit

"A Conversation Around Mainstreaming Corporate Social Responsibility: Can This Be Done?"
Monday, November 15
6:00 p.m.
World Trade Club, One Ferry Plaza, San Francisco
Michael Lewis, best selling author of Liar's Poker, Moneyball, and The New New Thing, and contributing writer to the New York Times Magazine, will be the moderator of a high-profile panel of the following corporate executives: Mike Homer, chairman of Kontiki and former EVP at Netscape; Debra Dunn, senior VP for Hewlett Packard; Bill Campbell, chairman of Intuit; Anne Gust, CAO at Gap Inc.; Mitch Kapor, founder and designer of Lotus 1-2-3; and Bob Dunn, former CEO of Business for Social Responsibility.
The panel will discuss corporate social responsibility from the business leaders' perspectives and from those of the industries they represent, in order to determine if and how CSR can be incorporated more fully into every aspect of a company's operations, culture, brand and value.
Register online:
Cost: $15/students, $25/alumni and friends through November 1, $30 thereafter and at the door
For more information: Tanya Steinhofer, MBA 99, tshaw_mba99@alumni.haas.org.

Forecasting the Post-Election Economy: a Lively and Informative Panel Discussion
Tuesday, November 16
6:30 p.m. to 8:30 p.m.
One Financial Center, Suite 1802, 655 Atlantic Avenue, Boston
Register online:
Cost: $30 in advance, $40 at the door. Hors d'oeuvres and cash bar.
What direction will the US economy take after the election? Join us for a timely discussion on the prospect of our economy for the next four years.
For more information, contact Celine Pan at 617-283-1562 or Lynne Levesque, MBA 77, lynnelevesque@cs.com .

The Haas NewsWire is the electronic news weekly for the Haas community published every Monday by the Marketing and Communications Office at the Haas School. Send your news, feedback, and suggestions to Haasnews@haas.berkeley.edu.

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