Anecdotal evidence suggests that new CEOs with foreign backgrounds direct their firms to become more international in their operations. We examine this hypothesis formally using data on U.S. S&P-500 manufacturing firms from 1992 through 1997 and biographical information on CEOs' birth and...

Multinational firms (MNEs) dominate trade flows, yet their global production decisions are often ignored in firm-level studies of exporting and importing. Using newly merged data on US firms' trade and multinational activity by country, we show that MNEs are more likely to trade not only with...

Regulation consists of rulemaking and enforcement. Economic theory offers two complementary rationales for regulating financial institutions. Altruistic public-benefits theories treat rules as governmental instruments for increas- ing fairness and efficiency across society as a whole....

Representation of women and minorities in a "selectorate"--the group that chooses an organization's leaders--is a key mechanism for promoting diversity. We show that representation, on its own, is not sufficient for selecting gender diversity: a supportive organizational culture is also...

Corporate culture is an omnibus term that includes many elements like norms, values, knowledge, and customs that are relevant to a firm. Economists have made great progress recently in devising methods of measuring different aspects of corporate culture. These empirical measures of culture have...

Social progress through improved treatment of minority groups (the embrace of anti-racist and anti-sexist norms, for example) may or may not spread to corporate cultures through competition. Sometimes the market fails to adapt on its own and government must pass legislation to secure changes in...

Politicians and regulators rely on feedback from the public when setting policies. For-profit corporations and non-pro t entities are active in this process and are arguably expected to provide independent viewpoints. Policymakers (and the public at large), however, may be unaware of the...

Markets and firms offer contrasting methods to arrange production. In markets, contracts govern the purchase of parts and services that compose production. In firms, the shared values, customs, and norms coming from a corporate culture govern employees' joint development of those parts and...

Between one-third and one-half of employees participate directly in company performance through profit sharing, gainsharing, employee ownership, or stock options. This flies in the face of concerns about the free rider problem and worker risk aversion in group incentives, and raises many...

What external control mechanisms are most effective in detecting corporate fraud? To address this question we study in depth all reported cases of corporate fraud in companies with more than 750 million dollars in assets between 1996 and 2004. We find that fraud detection does not rely on one...