The COVID-19 pandemic that we are experiencing is both tragic and shocking. There is no question that, except in some Asian countries trained by prior infectious outbreaks, most policy makers around the world have been ill-prepared to respond to the crisis. The effects of the coronavirus on our mental and physical health has been indeed calamitous, and the economic and financial impacts for many have been truly unfortunate. Furthermore, the extreme nature of the event is challenging researchers to compile and interpret new evidence that is arriving at a rapid pace. The editors Hui Chen, Thierry Foucault, Jeffrey Pontiff, and Nikolai Roussanov and contributing authors are to be commended for assembling and collating a thought-provoking collection of papers. More time and study will be needed to fully sift through the evidence and to glean the lessons to be learned from this pandemic for policy makers and investors. But the evidence and insights in this volume are a very good start.

Abstract. I examine how an internal auditor, called the firm, designs a control system for a strategic employee who conditions his thefts on the amount and types of controls. Society sets minimum testing amounts and fines for detected theft, whereas the firm determines the employee's wages and the amount of monitoring above the minimum. The results fall into three separate cases. When society's minimum testing standards and fines are sufficiently high, the employee never steals in any period. In this case, the firm performs the minimum amount of testing and pays the lowest feasible wage. In the remaining two cases, the testing standard and fines are too low to prevent theft by themselves. In these two cases the firm's control system determines whether there will be theft in the first period. I show that if the firm chooses to prevent all first‐period theft, then it uses only one type of control. She offers a wage premium and monitors the minimum amount. The wage premium substitutes for a tine large enough to prevent all theft. If the firm designs controls that do not prevent all theft, then the firm also uses only one control. In contrast to the no‐theft case, the firm pays the lowest feasible wage and monitors above the minimum. This choice reflects the increasing returns to scale of monitoring in preventing theft.

Elizabeth S. Hansen, Municipal Finances in Perspective: A Look at Interjurisdictional Spending and Revenue Patterns, Journal of Accounting Research, Vol. 15, Studies on Measurement and Evaluation of the Economic Efficiency of Public and Private Nonprofit Institutions (1977), pp. 156-201

I. A neoclassical macro theory for money wage changes, 2. — II. Neoclassical wage theory with spontaneous wage change and additional wage determinants, 3 — III. Vacancies and unemployment and excess demand, 5. — IV. The derivation of the Phillips relation, 8. — V. The form of the Phillips relation, 11. — VI. The cyclical characteristics of unemployment and vacancies, 17. — VII. Vacancies, unemployment, and equilibrium, 21.

This article explores the claim that college‐educated workers are increasingly likely to be in “noncollege” occupations. We provide a conceptual framework that gives analytical content to the previously vague distinction between “college” and noncollege jobs. We show that, when there is heterogeneity in preferences, equally productive college workers can be in college and noncollege jobs. This framework is also used to show that skill‐biased technological change will lead to a decline in the proportion of college workers in noncollege jobs. This prediction is supported by the data.

Abstract This article presents a theoretical case for replacement of conventional heteroskedasticity-consistent and cluster-robust variance estimators with jackknife variance estimators, in the context of linear regression with heteroskedastic and/or cluster-dependent observations. We examine the bias of variance estimation and the coverage probabilities of confidence intervals. Concerning bias, we show that conventional variance estimators have full downward worst-case bias, while our jackknife variance estimator is never downward biased. Concerning confidence intervals, we show that intervals based on conventional standard errors have worst-case coverage equalling zero, while the jackknife-based confidence interval has coverage probability bounded by the Cauchy distribution, under the auxiliary assumption of normal errors. We also extend the Bell and McCaffrey (2002) student t approximation to our jackknife t-ratio, resulting in confidence intervals with improved coverage probabilities. Our theory holds under broad assumptions, allowing arbitrary cluster sizes, regressor leverage, within-cluster correlation, heteroskedasticity, regression with a single treated cluster, fixed effects, and delete-cluster invertibility failures. Our theoretical findings are consistent with the extensive simulation literature investigating heteroskedasticity-consistent and cluster-robust variance estimation.

[This article suggests that the lack of use of rights offerings in the United States, a phenomenon referred to as the equity underwriting paradox, can be explained by transaction-cost conditions. A sample of underwritten rights offerings provides support for the explanation. Firms making underwritten rights offerings paid lower underwriter fees but incurred significantly larger price drops just prior to the offering than did firms making underwritten public offerings. Further analysis reveals that the underwritten-rights-offering price concessions are a form of transaction cost that is not found in underwritten public offerings.]