Using unique Chinese data classifying labor according to the function it performs within a firm, we document that growth in the marketing and sales workforce positively predicts future profitability and returns in the cross-section, with an annual long-short portfolio return spread of 7.4%.In...

This paper studies the relationship between asset growth and idiosyncratic stock return volatility. Empirically, in the cross-section, firms' idiosyncratic return volatility has a V-shaped relationship with their asset growth rate. In the time series, dispersion across firms in asset growth...

This paper examines the impact of banks' lending incentives on asset prices and bank cash holdings under liquidity risk. Banks make lending decisions based on the tradeoff between costs (fire sales of illiquid assets) and benefits (high returns from bank loans). This paper shows fire sales of...