Stocks that are expensive to borrow underperform significantly and for long periods of time. Every share must be held by an investor who does not lend it out and, hence, loses money. I find no evidence that investors hold these stocks in anticipation of lending them in the future. Instead, investors appear to hold these stocks for short-term trading. When turnover is high, high-fee stocks are overpriced and underperform. When turnover is low, high-fee stock prices are low, and they earn positive returns. More Robinhood investors hold shares when turnover is high than when it is low.

A short squeeze occurs if borrowed shares are recalled and the short seller is unable to find another source of shares. This forces the short seller to terminate a position early. For most stocks, the probability of a short squeeze is very low. Short squeezes, however, are not unusual for the hardest to borrow stocks. For these stocks, trading costs from squeezes are high and have a significant impact on the returns to short selling. For hard-to-borrow stocks, short sellers also miss out on significant abnormal returns because squeezes force them to close positions.

Short sale constrained stocks are overpriced on average. I show that firms exploit mispricing by selling shares when their stock is short sale constrained and repurchasing shares when their stock is easily shorted. Stocks underperform following seasoned equity offerings (SEOs) if and only if the stock is difficult to short. This suggests that some SEOs are motivated by mispricing, whereas others are not. Short selling costs make it difficult for investors to profit from the poor performance following SEOs. Short selling and SEOs are alternative ways to supply shares to investors, and firms become the low-cost share provider when short selling is costly.

Height is consulted as a latent indicator of early nutrition and lifetime health status. Height is observed to increase in recent decades in populations where per capita national income has increased and public health activities have grown. Height is determined by genetic make up and realized in part through satisfactory nutrition and health related care and conditions. Alternative instrumental variables (IV) are explored which proxy price and income constraints which are expected to influence the latter reproducible human capital investments in height. I report OLS and IV estimates of the partial effect of height on log hourly wages in recent national surveys from three countries: Ghana, Brazil and the United States. I conclude that the human capital productivity effect of height estimated by parent education IVs in the US and Ghana are many times larger than the OLS estimates, and in Ghana and Brazil the regional price IVs estimates also imply a substantially larger human capital wage effects of height compared with the OLS estimates. The OLS estimates of height effects on wages are dominated by the genetic variation in height, and appear to understate substantially the human capital returns to health and nutrition inputs which increase adult height.

This paper identifies demand induced changes in the price of women's time as a factor determining the fertility transition.Changes in world prices of grains and animal products in the 1880's affected the composition of Swedish output and labor demands.The increase in the price of butter relative to grains improved women's wages relat.ive to men's, and contributed thereby to the decline in fertility.When child mortality, urbanization, and the real wages of men are held constant, aggregate county-leveldata for a 50-year period, 1860-1910, suggest that this exogenous appreciation in the value of women's time, relative to men's, explains a quarter of the concurrent decline in Swedish fertility.

We develop a bid‐ask spread estimator from daily high and low prices. Daily high (low) prices are almost always buy (sell) trades. Hence, the high–low ratio reflects both the stock's variance and its bid‐ask spread. Although the variance component of the high–low ratio is proportional to the return interval, the spread component is not. This allows us to derive a spread estimator as a function of high–low ratios over 1‐day and 2‐day intervals. The estimator is easy to calculate, can be applied in a variety of research areas, and generally outperforms other low‐frequency estimators.

SOES bandits are individual investors who use Nasdaq's Small Order Execution System (SOES) for day trading. Their average profit per trade is small, but they trade dozens or hundreds of times per week. Bandits usually establish a position before most market-makers have updated their quotes, and lay off the position at favorable prices through Instinet or SelectNet. It is noteworthy that they trade profitably with market-makers despite having less information. Bandits keep the profits and bear the losses from their trades. Thus they have greater incentives to trade well than the employees of market-making firms.

Nasdaq's Small Order Execution System (SOES) allows orders to be submitted by computer, thereby assuring rapid execution at quoted prices. We examine trading in the 20 largest Nasdaq stocks around the time of a rule change that reduced the largest SOES trades from 1000 to 500 shares. We show that SOES trades contain information about short-term price movements and that SOES trading declined dramatically with the rule change. However, quoted and effective spreads were unaffected by the rule change.

Many believe that a bubble existed in Internet stocks in the 1999 to 2000 period, and that short‐sale restrictions prevented rational investors from driving Internet stock prices to reasonable levels. In the presence of such short‐sale constraints, option and stock prices could decouple during a bubble. Using intraday options data from the peak of the Internet bubble, we find almost no evidence that synthetic stock prices diverged from actual stock prices. We also show that the general public could cheaply short synthetically using options. In summary, we find no evidence that short‐sale restrictions affected Internet stock prices.