In addition to being a function of traditional fundamentals such as cash-flow persistence and the discount rate, the equilibrium association between a security price and a value-relevant statistic can simply be a function of what rational investors believe the association will be. We refer to...

Several recent empirical papers assert that the decision to disclose an earnings forecast shortly before the actual earnings announcement reveals only short-term information and is therefore unlikely to entail proprietary costs. Using a simple dynamic model of voluntary disclosure, we show that...

This paper estimates a dynamic model of clients' decisions to switch audit firm and misstate earnings as a function of auditor tenure. Adapting the conditional choice probability framework of Hotz and Miller (1993), which simplifies the estimation to a conditional logit, we find that dynamic...

Theory posits that investors can rationally infer the implications of strategic nondisclosure for firm value, pressuring managers to voluntarily disclose information. This study documents that the lack of an earnings guidance predicts an abnormal return of -41 basis points around the subsequent...