Financial markets in most developed economies were open to foreign investors before 1980, yet these countries continued to reform their financial systems dramatically in subsequent decades. During the same time period, high-skill industries become increasingly important; for example, in the US...

Corporate transparency reduces information asymmetries between firms and capital markets, but increases the costs associated with information leakage to competitors. We explore how a country's information environment affects innovation, an activity characterized by high information asymmetries...

We study a simple model of market making in which high-frequency market makers can cancel limit orders quickly after receiving an adverse signal. The resulting winner's curse induces low-frequency market makers to widen bid-ask spreads. Liquidity in the market may deteriorate unless...

Using a financial literacy survey of Swedish pension investors matched to actual retirement savings decisions, we argue that respondents can be broken into three groups: those who are financially literate, those who mistakenly believe they are financially literate, and those who know that they...

The economic disruption from the COVID-19 pandemic prompted governments around the world to initiate an unprecedented number of temporary lending and tax deferment programs. Which firms will benefit from these programs? What are the implications for firm balance sheets and post-crisis survival?...

We conduct a large scale survey of Swedish households to measure how much they understand about the science behind environmental impact, their financial literacy, as well as their understanding of their own knowledge of these matters. We find only moderate correlation in knowledge between...

We show that U.S. analysts alter their behavior in response to a randomly assigned shock that exogenously varies the timeliness and cost of accessing companies' mandatory disclosures in the cross-section of investors: analysts reduce the number of stocks they cover, issue less optimistic and...

This paper examines the effects of the 2008 short-sale ban on exchange traded funds (ETFs). Short sales of banned stocks decreased significantly during the ban period. However, we demonstrate that a portion of that decrease was reabsorbed by financial-sector ETFs and the biggest and most liquid...

We measure financial literacy among LinkedIn members, complementing standard questions with additional questions that allow us to gauge self-perceptions of financial literacy. Average financial literacy is surprisingly low given the demographics of our sample: fewer than two-thirds of CFOs,...

In this study, we investigate the profitability persistence of the investment recommendations from analysts listed in four different star rankings: Institutional Investor magazine, StarMine's “Top Earnings Estimators” and “Top Stock Pickers” and The Wall Street Journal. We compare the...