We study the impact of succession tournaments on risk-taking in family firms. More sons (less daughters) in controlling families are associated with higher income volatility and lower performance – especially, in opaque private firms with pyramidal ownership structure. Contestants exhibit...

State governments receive an exogenous tax windfall whenever their residents win a multi-state lottery. These lottery tax windfalls are counter-cyclical but occur during a range of economic conditions. Therefore, lottery tax windfalls enable us to estimate the impact of fiscal policy on...

We study the role of insurance companies in propagating liquidity shocks to the real economy. We use natural disasters as our instrument to identify exogenous shifts in capital market liquidity, and study whether capital market liquidity affects regional-level fiscal conditions and drives GDP...

Using economic deregulation as a quasi-natural experiment for increasing product market competition, we find increases in earnings manipulation and accounting frauds following deregulation. This “dark-side” of product market competition is particularly evident for deregulated firms in high...

Using novel inter-firm patent litigation data, we show that defendant firms become financially constrained, reduce innovation activity, and shift toward exploitative innovation leveraging past experience and expertise. The exploitative innovation strategy reflects the patent race motives and...

Using a simple cheap-talk game, we theoretically demonstrate that corporate social responsibility (CSR) helps mitigate the CEO-board information asymmetry, leading to more informed advising and monitoring by the board. By optimally engaging in CSR, the board can take advantage of stakeholder...

We find that CDS spreads contribute significantly to price discovery in financial markets when firm-specific credit information is prominent. Using 3,470 S&P rating notch and watch changes for U.S. public and private entities from 2001-2013, we show that CDS prices contain unique firm credit...