This paper studies the effects of labor adjustment costs on corporate risk management. Labor adjustment costs attenuate the correlation between a firm's internal funds and its investment opportunity and create more incentives for the firm to smooth internal funds. Using a state border...

In this paper, we study common ownership in U.S. labor markets, and document that common ownership more than doubled over the period 1999–2017. To identify the causal effects of common ownership on labor market outcomes, we use a firm’s addition to the S&P 500 index as a shock to the common...