Publications

We develop and estimate a dynamic model of risk-shifting over the business cycle. First, equity holders with Epstein-Zin preferences increase their taking of idiosyncratic risk substantially more than the standard model in repeated games, because…

Psychologists have long sought to understand how people experience, think, and communicate about situations. Psychology’s protracted journey toward understanding psychological situations recently took a momentous turn toward more rigorous…

The pervasiveness, persistence, and petrifying scope of intergroup conflict have fueled substantial scholarly interest in intergroup conflict across the social and biological sciences. Here we outline five questions that we hope students of…

We examine the long-term effects of interventions by activist hedge funds. Research documents positive equal-weighted long-term returns and operating performance improvements following activist interventions, and typically conclude that activism…

The recent sharp decline in the cost of renewable energy suggests that the production of hydrogen from renewable power through a power-to-gas process might become more economical. Here we examine this alternative from the perspective of an…

This study investigates whether investors are willing to trade-off wealth for societal benefits. We take advantage of unique institutional features of the municipal securities market to provide insight into this question. Since 2013, over $23…

We apply causal forests to a dataset derived from the National Study of Learning Mindsets, and consider resulting practical and conceptual challenges. In particular, we discuss how causal forests use estimated propensity scores to be more…

We examine the selection of peer groups that boards of directors use when setting the level of CEO compensation. This choice is controversial because it is difficult to ascertain whether peer groups are selected to (i) attract and retain top…

How do U.S. companies respond to incentives intended to encourage domestic manufacturing? I study the Domestic Production Activities Deduction (DPAD), which was enacted in the American Jobs Creation Act of 2004 and was the third largest U.S.…

We examine the relation between tax net operating loss (NOL) carryforwards and corporate cash holdings. Corporate taxation of passive income increases the cost of holding liquid assets (“cash”), but NOLs can shield that income from tax. We test…

The paper considers a model of competition among firms that produce a homogeneous good in a networked environment. A bipartite graph determines which subset of markets a firm can supply to. Firms compete à la Cournot and decide how to allocate…

We use a massive, matched employer-employee database for the United States to analyze the contribution of firms to the rise in earnings inequality from 1978 to 2013. We find that one-third of the rise in the variance of (log) earnings occurred…

We present a new perspective on the Synthetic Control (SC) method as a weighted least squares regression estimator with time fixed effects and unit weights. This perspective suggests a generalization with two way (both unit and time) fixed…

We examine how U.S. individuals respond to regulation intended to reduce offshore tax evasion. Specifically, we study investment responses to the Foreign Account Tax Compliance Act (FATCA), which requires foreign financial institutions to report…

Two heterogeneous agents contribute over time to a joint project and collectively decide its scale. A larger scale requires greater cumulative effort and delivers higher benefits upon completion. We show that the efficient agent prefers a smaller…

This paper analyzes a game in which countries repeatedly make emission and technology investment decisions. We derive the best equilibrium, that is, the Pareto-optimal subgame-perfect equilibrium, when countries are insufficiently patient for…

Previous research has emphasized corporate lobbying as a pathway through which businesses influence government policy. This article examines a less-studied mode of influence: private regulation, defined as voluntary efforts by firms to restrain…

We introduce a novel measure of segregation, experienced isolation, that captures individuals’ exposure to diverse others in the places they visit over the course of their days. Using novel Global Positioning System (GPS) data collected…

In this paper, we demonstrate that the funding value adjustments (FVAs) of major dealers are debt overhang costs to their shareholders. To maximize shareholder value, dealer quotations therefore adjust for FVAs. Our case studies include interest‐…

This case (A), and its related cases (B-E), establish a setting to discuss an M&A transaction and some of the key legal contracts that are associated with it. In 2010, private equity backed food manufacturer Pierre Foods is contemplating the…