Publications

Consumers often feel pressed for time, but why? This research provides a novel answer to this question: subjective perceptions of goal conflict. We show that beyond the number of goals competing for their time, perceived conflict between goals…

We find strong empirical support for the risk-shifting mechanism to account for the puzzling negative relation between idiosyncratic volatility and future stock returns documented by Ang, Hodrick, Xing, and Zhang (2006). First, equity holders…

I study the efficiency of three prominent accounting rules in a delegated bidding setting where bidders’ incentives are tied to both accounting income and economic surplus. Trade efficiency is maximized (minimized) by the value-in-use method (…

Across five studies, this research reveals that feeling powerful increases saving. This effect is driven by the desire to maintain one’s current state. When the purpose of saving is no longer to accumulate money, but to spend it on a status-…

This study finds that more conservative earnings have lower information content in that higher conditional conservatism decreases the speed with which equity investor disagreement and uncertainty resolve at earnings announcements. We find that a…

Several studies have focused on stratifying patients according to their level of readmission risk, fueled in part by incentive programs in the U.S. that link readmission rates to the annual payment update by Medicare. Patient-specific predictions…

Although doctors and hospitals own their patients’ medical records, state and federal laws require that they provide patients with a copy at “reasonable cost.” We examine the effects of state laws that…

That citizens engage in retrospective voting is widely established in the literature. But to what extent is retrospection affected by the expectations that leaders set in advance? We develop a theoretical framework of how expectation setting…

 Fixed statutes and regulations often have variable consequences over time. If left unattended, such drift can severely erode the performance of government as an institution of representation. To better understand the mechanics of…

Many advertisers are reluctant to shift a large proportion of their advertising budgets to the Internet because they still view television advertising as the main vehicle for building a brand. Using a unique and rich data set comprising 20…

Do mandatory spending programs such as Medicare improve efficiency? We analyze a model with two parties allocating a fixed budget to a public good and private transfers each period over an infinite horizon. We compare two institutions that differ…

Although cooperation between groups is not unusual, most forms of human cooperation are in-group bounded and, sometimes, motivated by the desire to ward-off and subordinate rivaling out-groups. Building on evolutionary perspectives and models, we…

We analyze how banks’ responses to asset gains and losses can result in procyclical leverage. The analysis reveals that absent differences in regulatory risk weights across assets, leverage is not procyclical. We test predictions from the…

Excessive leverage (indebtedness) in banking endangers the public and distorts the economy. Yet current and proposed regulations only tweak previous regulations that failed to provide financial stability. This paper discusses the forces that have…

We propose that category membership can operate as a collective market signal for quality when low-quality producers face higher costs of gaining membership. The strength of membership as a collective signal increases with the sharpness of the…

As participant recruitment and data collection over the Internet have become more common, numerous observers have expressed concern regarding the validity of research conducted in this fashion. One growing method of conducting research over the…

We establish an important role for the firm by studying capital reallocation decisions of mutual fund firms. At least 30% of the value mutual fund managers add can be attributed to the firm’s role in efficiently allocating capital amongst…

We outline key steps necessary to reform the London Interbank Offered Rate (LIBOR) so as to improve its robustness to manipulation. We first discuss the role of financial benchmarks such as LIBOR in promoting over-the-counter market…

This paper studies the effect of performance feedback on tournament outcomes, when a possibly dishonest principal may manipulate the agents’ expectations to stimulate their effort. Under plausible circumstances, an increase in the principal’s…