In this paper, we study a new channel to explain firms' price setting behavior. We propose that uncertainty about factor prices has a positive effect on markups. We show theoretically that firms with higher shares of inputs with volatile prices set higher markups. We use the Bartik shift-share...

Rumors can be classified into two types, according to whether they can credibly predict impending events or not. The analysis of takeover rumors of publicly traded US companies from 1990 to 2008 shows that these two types of rumors can be statistically distinguished by returns of rumored...

We explore the asset pricing implications of shocks that allow firms to extract more rents from consumers. These markup shocks directly impact the representative household's marginal utility and the firms' cash flow. Using firm-level data, we construct a measure of aggregate markup shocks and...

Rumors can be classified into two types, according to whether they can credibly predict impending events or not. The analysis of takeover rumors of publically traded US companies from 1990 to 2008 shows that these two types of rumors can be statistically distinguished by returns of rumored...

I analyze changes in apparel company stock prices when Michelle Obama wears designer outfits at public events. Company stock prices rise significantly when the First Lady wears their clothing, increasing about 1.7% in the week following her most closely watched appearances and by about half as...

I analyze changes in apparel company stock prices when Michelle Obama wears designer outfits at major events. The First Lady's selections can create value exceeding $100 million for companies that design and market her clothing. The effect is approximately $2.3 billion during a 2009 European...