To test hypotheses about earnings management many studies investigate managers’ manipulation of real activities (real earnings management, REM). Tests using measures of abnormal REM hinge critically on the measurement of normal real activities. Yet there is no systematic evidence on the...

Bradshaw and Sloan (2002) document a significant increase in the difference between the earnings response coefficients (ERCs) for GAAP and Street (I/B/E/S) earnings over the 1990s, suggesting that the market has become increasingly reliant or fixated on Street earnings. In this study we...

Recent empirical and anecdotal evidence suggests that U.S. firms hold a significant amount of cash on their balance sheets. Motivated by this observation, we seek to examine whether a firm's customer base composition, in particular the amount of sales transactions with the U.S. government,...

We examine whether customer-base concentration has a differential impact on profitability for firms contracting with major government customers versus firms contracting with major corporate customers. We document that firm profitability increases with the concentration of major government...

We examine how firms' contractual relationships with their employees affect the design of their debt contracts, and their use of financial covenants and pricing grids in particular. Viewing the firm as nexus of both explicit and implicit contractual relationships, we argue that managers...