This paper investigates how shocks to expected cash flows influence CEO incentive compensation. Exploiting changes in compliance with environmental regulations as shocks to expected future cash flows, we find that adverse shocks typically prompt corporate boards to recalibrate CEO compensation...

Although corporate finance theory suggests how adverse shocks influence shareholder preferences toward corporate risk-taking and executive compensation, few researchers explore this relationship empirically. We construct a firm-year measure of unexpected shocks to environmental regulatory...

Financial reports present assets, liabilities, and earnings on a nominal basis (unadjusted for inflation). Using a novel dataset of nearly a century of financial reports, this paper examines whether and how inflation affects the relation between accounting earnings and stock market value, i.e.,...

Secured lenders have recently demanded a new condition in distressed debt restructurings: competing secured lenders must lose priority. We model the implications of this "creditor-on-creditor violence" trend. In our dynamic model, secured lenders enjoy higher priority in default. However,...

We develop a unified framework to trace value added along global supply chains in the presence of foreign direct investment by decomposing either GDP based on forward linkages or final production based on backward linkages. The new framework accounts for the presence of foreign invested...

We provide a unified framework for measuring bilateral exports of value added. We outline a general methodology that encompasses the measures introduced by Johnson and Noguera (2012) (value added consumed abroad) and Los et al. (2016) (value added in exports), to which we refer as VAX-C and...

This paper examines the impact of government-sponsored venture capitalists (GVCs) on the success of enterprises. Using international enterprise-level data, we identify a surprising non-monotonicity in the effect of GVC on the likelihood of exit via initial public offerings (IPOs) or third party...

This paper provides both a conceptual framework for decomposing a country's gross exports into value-added components by source and a new bilateral database on value-added trade. Our parsimonious framework integrates all previous measures of vertical specialization and value-added trade in the...

The rise of China in world trade has brought both benefits and anxiety to other economies. For many policy questions, it is crucial to know the extent of domestic value added (DVA) in exports, but the computation is more complicated when processing trade is pervasive. We propose a method for...