We analyze two managerial compensation incentive devices: the threat of termination and pay for performance. We first develop a simple model predicting that these devices are substitutes: when termination incentives are low, optimal contracts provide stronger pay-for-performance incentives. We...

Financial misconduct (FM) rates differ widely between major U.S. cities, up to a factor of three. Although spatial differences in enforcement and firm characteristics do not account for these patterns, city-level norms appear to be very important. For example, FM rates are strongly related to...

We find that a firm's tendency to engage in financial misconduct increases with the misconduct rates of neighboring firms. This appears to be caused by peer effects, rather than exogenous shocks like regional variation in enforcement. Effects are stronger among firms of comparable size, and...

A deep voice is evolutionarily advantageous for males, but does it confer benefit in competition for leadership positions? We study ecologically valid speech from 792 male public-company Chief Executive Officers (CEOs) and find that CEOs with deeper voices manage larger companies, and as a...

We find that a firm's tendency to engage in financial misconduct increases with the misconduct rates of neighboring firms. This appears to be caused by peer effects, rather than exogenous shocks like regional variation in enforcement. Effects are stronger among firms of comparable size, and...