I analyze the effect of non-compete agreements (NCAs) on the allocation of inventors across product markets. NCAs constrain the within-industry employment choice set of inventors. In a staggered difference-in-differences, I show causal effects that two in hundred inventors per year (increase of 42 percent) respond to more enforceable NCAs by moving to more distant product markets. Across-industry mobility is largest for inventors likely bound by NCAs. Within-industry mobility on the other hand is reduced. Reallocated inventors are subsequently less productive and there is a lower quality match between inventors and their new employers. I highlight how product market choice set constraints can have detrimental effects through reallocation of human capital to more distant product markets.

Many initial public offerings (IPOs) are priced at exactly the high-end of the pricing range. Investing in IPOs priced at the high-end leads to first-day returns that are substantially higher than investing in IPOs that are priced just below or above the high-end. We argue that these results are in line with issuing firms settling for positively perceived salient pricing points in negotiations with underwriters.