We provide evidence that increased reporting frequency enhances the extent to which stock prices guide managers' investment decisions. Using a generalized difference-in-differences research design, we find the sensitivity of investment to stock price increased for Mandatory Adopters following an...

We derive microscopic foundations for a well-known probabilistic herding model in the agent-based finance literature. Lo and behold, the model is quite robust with respect to behavioral heterogeneity, yet structural heterogeneity, in the sense of an underlying network structure that describes...

In the context of an equilibrium model with multiple risky assets, we map the characteristics of the network connecting firms' fundamentals to the cross-section of expected returns. We interpret network connectivity as the ability to transfer a distress state to other firms' fundamentals in a...

This paper evaluates the role of a corporate network in spreading news and in particular shows how it affects prices. We build daily corporate news network using companies of the STOXX 50 index as nodes; the weights of the edges are the number of news items sharing common topics between...

We introduce various network similarity measures that can capture the topological changes of investor networks over time. We use them to study the joint dynamics of investor networks and stock price time series. We find that the network changes are positively correlated with volatility while...