We examine the causal effects of uncertainty on corporate innovation by exploiting terrorism events. During the five-year window after terrorist attacks, firms near the strikes experience meaningful declines in R&D spending, patenting, citations, patent originality, and innovation value. These...

We study the impact of regulation on acquisition investment, using a novel firm-level measure of exposure to all federal regulations. Highly regulated companies issue more acquisition bids, invest more in those transactions, and earn higher M&A announcement returns. Moreover, highly regulated...