We examine how shocks to perceived accounting quality lead to market prices that reflect an increased weight on prior disclosures of insider trading. We use a sample of firms where industry peers have restated financial information and find that the short-term market reaction to announcements of...

We examine whether differences in the accounting measurement of investment activities help explain the negative association between aggregate investments and future returns. We decompose aggregate investment activity into investments in tangible and intangible assets. We find that the previously...