Publications

Currently available medication for treating many chronic diseases is often effective only for a subgroup of patients, and biomarkers accurately assessing whether an individual belongs to this subgroup do not exist. In such settings, physicians…

We show that the price of a Treasury bond and an inflation-swapped Treasury Inflation-Protected Securities (TIPS) issue exactly replicating the cash flows of the Treasury bond can differ by more than $20 per $100 notional. Treasury bonds are…

The question of whether management control systems (MCS) adopted by start-up companies are valuable is examined. We investigate an international sample of start-ups, including their detailed MCS adoptions and financing histories. We find that…

We examine how the composition of public debt, broken down by currency, maturity, holder profile and marketability, has responded to major debt accumulation and consolidation episodes during 1900-2011. Covering thirteen advanced economies, we…

This paper studies dynamic disclosure when the firm value evolves stochastically over time. The presence of litigation risk, arising from the failure to disclose unfavorable information, not only prompts bad news disclosures but also crowds out…

Entrepreneurship requires creativity and business acumen. Creativity may decline with age, but business skills increase with experience in high level positions. Having too many older workers in society slows entrepreneurship. Not only are older…

Dutta and Fan (Rev Account Stud, 2014), this issue, study the implications of earnings management on managerial compensation, in a two-period LEN setting. They…

Although recent research documents a positive relation between corporate transparency and the proportion of independent directors, the direction of causality is unclear. We examine a regulatory shock that substantially increased board…

Legislators claim that how they explain their votes matters as much as or more than the roll calls themselves. However, few studies have systematically examined legislators’ explanations and citizen attitudes in response to these explanations. We…

This Closer Look illustrates the relation between executive compensation and organizational risk through the context of the financial crisis of 2008. We demonstrate that the incentives that bankers had to increase firm risk not only increased but…

Across six field and laboratory experiments, participants given a concretely-framed prosocial goal (e.g., making someone smile, increasing recycling) felt happier after performing a goal-directed act of kindness than did those who were assigned a…

Three studies tested the hypothesis, derived from construal-level theory, that hierarchical distance between leaders and followers moderates the effectiveness of leader behaviors such that abstract behaviors produce more positive outcomes when…

This paper investigates the impact of lower mortgage rates on household balance sheets and other economic outcomes during the housing crisis. We use proprietary loan-level panel data matched to consumer credit records using borrowers’ Social…

This study seeks to determine whether earnings announcements pose non-diversifiable volatility risk that commands a risk premium. We find that investors anticipate some earnings announcements to convey news that increases…

We study optimal compensation contracts that (1) are designed to address a joint moral hazard and adverse selection problem and that (2) are based on performance measures, which may be manipulated by the agent at a cost. In the model, a manager…

We examine the possibility that people can leverage their “relationship” with God as a stand-in for interpersonal relationships. More specifically, we hypothesize that people will seek closeness with the divine when facing the threat of…

We hypothesize that two distinct facets of religiosity—orthodoxy (an emphasis on belief) and orthopraxy (an emphasis on behavior)—predict differential sensitivity to an actor’s intent when making moral judgments. Participants judged actors who…

While creative ideas are defined as both novel and useful, novelty and usefulness often diverge, making it difficult to develop ideas that are high in both. To explain this tradeoff between novelty and usefulness and how it can be overcome, this…

Using bottom-up information from corporate financial statements, we examine the relation between aggregate investment, future equity returns, and investor sentiment. Consistent with the business cycle literature, corporate investments peak during…

Using the value that a mutual fund extracts from capital markets as the measure of skill, we find that the average mutual fund has used this skill to generate about $3.2 million per year. We document large cross-sectional differences in skill…