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Associate Professor of Finance and Business Economics
Research Associate, NBER |
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Recent Research
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"The Business of City Hall"
Management Science, Reject and Resubmit Large US city governments have revenues similar to the largest public corporations, collect revenues increasingly through user fees rather than taxes, and have predictable net income based on population and personal income. |
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"Sectoral Comovement and Conglomerate Networks"
with Lei Kong and Xinyan Yan Working Paper Conglomerate firms create a network of industries that transmits economic shocks across the economy. |
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"The Redistribution of Housing Wealth Caused by Rent Control"
with Marco Giacoletti Working Paper Following the passage of rent control in St. Paul, Minnesota, higher income renters gained more than lower-income renters, while small landlords lost the same as large landlords. |
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"From Ecological Diversity to Economic Concentration"
with Lei Kong and Xinyan Yan Working Paper Leveraging a generalized measure of concentration derived from research on biodiversity, industry concentration has not declined, contrary to conventional wisdom, though industries have become more homogenous. |
Publications
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"The Role of Media in Financial Decision-Making"
with Joel Peress Handbook of Financial Decision-Making, 2023 A survey of the literature shows that through 1) providing access to information, 2) filtering information, and 3) creating new information, the media improves financial decision-making. |
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"Do Proxies for Informed Trading Measure Informed Trading? Evidence from Illegal Insider Trades"
Review of Asset Pricing Studies, 2020 Lead Article/Editor's Choice Article Out of a list of standard measures of illiquidity, only absolute order imbalance and effective spreads predict informed trading, but only when information is short-lived. |
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"Information Networks: Evidence from Illegal Insider Trading Tips"
Journal of Financial Economics, 2017 Fama/DFA Prize for Best Paper on Capital Markets and Asset Pricing (First Place) Illegal inside traders form networks based on long-lasting social relationships, earning returns of 35% in 21 days per tip. Download: Insider Trading Data |
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"Lost in Translation? The Effect of Cultural Values on Mergers Around the World"
with Daniele Daminelli and Cesare Fracassi Journal of Financial Economics, 2015 Jensen Prize for Best Paper in Corporate Finance and Organizations (Second Place) Summarized in Finance and Accounting Memos, 2014 National cultural differences lead to fewer cross-border mergers and have a negative effect on wealth creation. Download: Cultural Values Data |
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"Rumor Has It: Sensationalism in Financial Media"
with Denis Sosyura Review of Financial Studies, 2015 Media articles about large, public firms with recognizable brands are less accurate than articles about less newsworthy firms. Download: Merger Rumors Data |
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"Peer Effects in Risk Aversion and Trust"
with Ran Duchin and Tyler Shumway Review of Financial Studies, 2014 Random assignment of MBA students to peer groups provides causal evidence that peers influence risk aversion. |
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"Do Common Stocks Have Perfect Substitutes? Product Market Competition and the Elasticity of Demand for Stocks"
Review of Economics and Statistics, 2014 Firms in more competitive industries are less substitutable and have less elastic demand curves for their stock. |
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"The Importance of Industry Links in Merger Waves"
with Jarrad Harford Journal of Finance, 2014 Merger waves propagate across an economy through customer-supplier industry links. |
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"Who Writes the News? Corporate Press Releases During Merger Negotiations"
with Denis Sosyura Journal of Finance, 2014 Firms influence their media coverage during private negotiations to improve the terms of trade in mergers. |
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"The Changing of the Boards: The Impact on Firm Valuation of Mandated Female Board Representation"
with Amy Dittmar The Quarterly Journal of Economics, 2012 A ground-breaking quota for women directors in Norway caused substantial changes to firm policy and value. |
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"Bargaining Power and Industry Dependence in Mergers"
Journal of Financial Economics, 2012 Targets with less product market dependence on an acquirer capture more of the gains in a merger. |
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"Sample Selection and Event Study Estimation"
Journal of Empirical Finance, 2009 Event study samples have characteristics with known pricing biases; characteristic-based benchmarks help. |
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"M&As: The Good, the Bad, and the Ugly"
with J. Fred Weston Journal of Applied Finance, 2007 In review, the neoclassical theory of mergers has more explanatory power than behavioral or redistribution theories. |
Permanent Working Papers
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"Network Centrality and the Cross Section of Stock Returns"
Permanent Working Paper Industries that are more central in the network of intersectoral trade earn higher stock returns. |
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"The Importance of Psychology in Economic Activity: Evidence from Terrorist Attacks"
Permanent Working Paper Controlling for institutional responses, terrorist attacks cause declines in trust, subjective well-being, and the importance of creativity and freedom at the individual level, but increases in economic output and household income at the macro level. |