This study exploits the staggered adoption of the inevitable disclosure doctrine (IDD) by U.S. state courts as an exogenous shock that generates variations in the proprietary costs of disclosure. We find that firms respond to IDD adoption by reducing the level of disclosure regarding their...

Universal demand (UD) laws impose obstacles on shareholders who wish to file derivative lawsuits. In this paper, we examine the negative consequences of the staggered adoption of UD laws: threatening employee safety. Using the workplace safety data from OSHA, we find that firms experience a 27%...

We document peer effect as an important factor in determining corporate voluntary disclosure policies. Our identification strategy relies on a discontinuity in the distribution of institutional ownership caused by the annual Russell 1000/2000 index reconstitution. Around the threshold of the...

This paper examines whether and how banks adapt to long-run climate change. We show that banks increase their loan loss provisions by 7% in response to a 1°F increase in three-year weighted average abnormal temperature. Such an effect is more pronounced when banks have greater pre-existing...

We advance a multistakeholder framework that highlights the influence of stakeholders in tempering short-termist responses to capital market pressures. When firms face pressure from short sellers in the capital market, they sometimes shift attention to short-term stock performance and neglect...

We examine how information processing cost affects investors' acquisition of firm-specific information using a natural experiment resulting from a recent mandate that US firms be required to adopt the eXtensible Business Reporting Language (XBRL) when submitting filings to the SEC. XBRL filings...

We investigate tax incidence reflected in the pricing of syndicated loans and argue that loan spread increases in bank income taxes of borrowers’ home states. We compare borrowers in states with differing bank tax rates and demonstrate the presence of tax incidence on borrowers with causality...