We study how a pioneer of peer-to-peer rental, Airbnb, affects the local economy. Using venture capital infusions as plausibly exogenous shocks to Airbnb's expansion into a new county, we find that Airbnb expansion leads to poorer hotel performance in the local county. Meanwhile, Airbnb...

We examine whether and how German and US investment professionals use corporate social responsibility (hereafter, CSR) information when making personal investment decisions and recommendations to clients. Using an experiment, we find that both German and US investment professionals use CSR...

We investigate whether recognition on the face of the financial statements versus disclosure in the footnotes influences the amount that financial managers report for a contingent liability. Using an experiment with corporate Controllers and Chief Financial Officers, we find that financial...

Survey evidence suggests that managers choosing to provide earnings guidance do so in order to, among other things, dampen share price volatility. Yet, consultants and influential institutions strongly urge managers to cease guidance — citing a lack of evidence that guidance curbs volatility....

We find that small innovators earn higher returns than small non-innovators for up to five years. We find no such innovation premium among large firms. A battery of tests shows that this innovation premium among small firms is explained by risk. Our findings, which are based on a simple measure...

Many studies use GAAP effective tax rates (ETR) as proxies for tax avoidance and rely on the maintained assumption that very low (high) ETRs represent the greatest (least) tax avoidance. We provide large-sample empirical evidence on how well ETRs capture cross-sectional differences in tax...

Prior literature documents a positive (negative) relation between past (future) stock returns and both external financing and capital expenditures. There has been much debate in the literature regarding the mechanisms driving these relations. In this study, we employ both a stock's extreme...

We examine the response of individual investors to firms' adoptions of SFAS 109–Accounting for Income Taxes. We predict SFAS 109 (as compared to APB 11) provides new decision-useful information, reducing the information disadvantage of individual investors relative to more sophisticated...

We provide insights into the inputs and valuation models used by valuation specialists. We survey 172 valuation specialists and conduct several follow-up interviews covering various topics, including the valuation inputs, models, and industry information that they use, as well as how they...

Bagnoli and Watts (2005) propose that a manager could reduce information asymmetry by choosing an income-decreasing accounting choice that signals the firm's relatively good future prospects. A limitation in testing this theory is that most income-decreasing accounting choices over time reverse...