We undertake the first large-sample analysis of foreign tax holiday participation by U.S. firms.
In academia, citations received by articles are a critical metric for measuring research impact. An important aspect of publishing in academia is the ability of the authors to navigate the review process and despite its critical role very little is known about how the review process may impact the research impact of an article.
We empirically investigate the effect of uncertainty on corporate hiring. Using novel data from the labor market for MBA graduates, we show that uncertainty regarding how well job candidates fit with a firm’s industry hinders hiring and that firms value probationary work arrangements that provide the option to learn more about potential full-time employees.
There is widespread concern about whether Chief Executive Officers (CEOs) are appropriately punished for poor performance. While CEOs are more likely to be forced out if their performance is poor relative to the industry average, overall industry performance also matters.
Life financial outcomes carry a significant heritable component, but the mechanisms by which genes influence financial choices remain unclear. Focusing on a polymorphism in the promoter region of the serotonin transporter gene (5-HTTLPR), we found that individuals possessing the short allele of this gene invested less in equities, were less engaged in actively making investment decisions, and had fewer credit lines.
We document that prior portfolio choices influence investors’ expectations about asset values, and their future choices. We find that people update more from information consistent with their prior choices, leading to sticky portfolios over time.
Millions of employees face work schedules and wages that change frequently as firms try to match labor to demand. Here, we use personnel records from the retail industry to examine whether workers’ income precariousness impacts firm performance.
We show that individuals’ macroeconomic expectations are influenced by their socioeconomic status (SES). Individuals with higher income or higher education levels are more optimistic about future macroeconomic developments, including business conditions, the national unemployment rate, and stock market returns.
We investigate the number of and reasons for errors and questionable judgments that sell-side equity analysts make in constructing and executing discounted cash flow (DCF) equity valuation models. For a sample of 120 DCF models detailed in reports issued by U.S. brokers in 2012 and 2013, we estimate that analysts make a median of three theory-related and/or execution errors and four questionable economic judgments per DCF.
Despite the central role played by human capital in entrepreneurship, little is known about how employees in entrepreneurial firms are compensated and incentivized. We address this gap in the literature by studying 18,935 non-CEO compensation contracts across 1,809 privately held venture-backed companies.
This paper examines the relation between cognitive perceptions of management and firm valuation. We develop a composite measure of investor perception using 30-second content-filtered video clips of initial public offering (IPO) roadshow presentations. We show that this measure, designed to capture viewers’ overall perceptions of a CEO, is positively associated with pricing at all stages of the IPO (proposed price, offer price, and end of first day of trading).
This paper investigates whether greater competition increases or decreases individual bank and banking system risk. Using a new text-based measure of competition, and an instrumental variables analysis that exploits exogenous variation in bank deregulation, we provide robust evidence that greater competition increases both individual bank risk and a bank's contribution to system-wide risk.
Contrary to the guidance provided by regulators and industry associations suggesting that mortgage servicing rights (MSRs) be recorded as Level 3 assets, Altamuro and Zhang identify that 25 % of banks classify them as Level 2 assets. This variation in the asset classification of a single asset type provides a unique setting to examine the role of inputs in the fair value measurement process.
Linguistic features of a firm’s regulatory filings, taken at face value, convey valuable information about the firm. In this paper, we examine whether a manager-specific, non-economic component also exists within these filings and whether investors consider this component when assessing firm value. To do so, we build on prior research that shows founders have unique personality attributes, including excessive optimism.
The design and use of standard processes are foundational recommendations in many operations practices. Yet, given the demonstrated performance benefits of standardized processes, it is surprising that they are often not followed consistently. One way to ensure greater compliance is by electronically monitoring the activities of individuals, although such aggressive monitoring poses the risk of inducing backlash.
This paper studies an optimal procurement mechanism for a newsvendor-like problem where the buyer's (newsvendor's) purchase price of the supplies is not fixed, but determined through interaction with candidate suppliers. The buyer has priors on the suppliers' costs but does not know their costs exactly. Recent literature has shown how the buyer can implement the optimal procurement mechanism by announcing a revenue function (specifying a payment for each quantity the buyer may purchase), then auctioning off the supply contract with the specified revenue function.
As healthcare costs continue to rise, many Americans are looking to artificial intelligence to provide cost-reducing solutions. At the 13th annual UNC Business of Healthcare Conference, a panel of experts separated the AI hype from reality in a discussion of the limitations, risks and ethical questions surrounding AI solutions in healthcare.
The unprecedented increase in non-bank financial intermediation, particularly open-end mutual funds and ETFs, over the last two decades, accounts for nearly half of external financing flows to emerging markets exceeding cross-border lending by global banks.
We document that there is commonality in the loan fees that short sellers pay, and the common component of loan fees explains a significant amount of loan fee variation. While the top principal component of stock returns only explains 28.3% of their variation, we find that the top principal component of loan fees explains 45.6% of their variation.
The ways in which media news is slanted can shape beliefs about the economy, thereby affecting the decision to start a new business. Using exogenous variation in the introduction of Fox News Channel across US counties, I find that increased exposure to a pro-Republican slant during a Republican administration is positively associated with new firm creation.