How do the distance constraints faced by lenders in acquiring borrower information affect the design of bank loan contracts? Theoretical studies posit that greater information asymmetry leads to the allocation of stronger ex ante decision rights to the lender (the uninformed party). Consistent...

This study examines the implications of using national-level (i.e., audit firm-wide) data aggregated across individual practice offices when testing for quality differentiation in auditing. I present a statistical framework that identifies the nature and sources of bias in aggregation when...