ABSTRACT This paper employs a firm-level collective bargaining dataset to investigate the effect of labor, as an important stakeholder of a firm, on debt contracting. I conjecture and provide evidence that firms with strong organized labor prefer bank loans to public bonds because, by communicating with banks privately, unionized firms can reduce the adverse selection costs while preserving the information asymmetry with organized labor. Furthermore, I show that organized labor influences the structure of syndicated loans. When firms with strong unions withhold public disclosures, but communicate privately with lead lenders, heightened information asymmetry between the lead lenders and the participant lenders induces the lead lenders to retain larger shares of the loans and form more concentrated syndicates. Overall, this study demonstrates that the proprietary costs of disclosure related to organized labor significantly influence firms' debt contracting decisions and outcomes. Data Availability: Data are available from sources identified in the text.

ABSTRACT We examine the commitment effect provided by mandatory disclosure and the information effect of voluntary disclosure on market illiquidity by exploring a regulatory change that allows smaller reporting companies to reduce the disclosure of certain information in their SEC filings. This regime change allows us to separate the commitment effect provided by mandatory disclosure from the information effect of voluntary disclosure. We find that firms that are eligible to reduce their disclosure, but voluntarily maintain their disclosure level, experience an increase in market illiquidity. We also find that the increase in illiquidity is more pronounced for firms with higher agency costs. These findings suggest that mandatory disclosure serves as a credible commitment mechanism and that losing such commitment by disclosure deregulation is costly in the absence of a loss of information. Our study suggests that while voluntary disclosure is effective in reducing information asymmetry, it cannot replace mandatory disclosure in addressing information problems. Data Availability: Data are available from sources identified in the text.

ABSTRACT We examine how the ordering of information within quarterly earnings announcements influences investor response to those announcements. Specifically, we examine whether earlier discussion of earnings information, and earlier discussion of qualitatively positive or negative information, is associated with stronger responses to that information. Controlling for the linguistic content of the earnings announcement, we find a positive relation between investor response to information and the prioritization of that information in the earnings announcement. We find no evidence of investor over-reaction and, to the contrary, find some evidence that investors under-react to prioritized information. Our evidence, in conjunction with experimental evidence in Elliott (2006), suggests that information placement influences investors' responses. However, unlike the experimental evidence in Elliott (2006), our archival results suggest that investor response to information placement is warranted, rather than the result of an unintentional cognitive effect. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: G14; G41; M40.

ABSTRACT This study focuses on the effect of disclosure processing frictions in labor markets. We go back in time 30 years ago and examine whether firms facing strong organized labor strategically responded to the implementation of the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system, which substantially reduced labor unions’ information processing costs. Consistent with firms having incentives to maintain an information advantage over unions for bargaining purposes, we find that they reduce financial statement disaggregation, the likelihood and frequency of management forecasts, and the proportion of good news forecasts. Our study is the first to investigate the implications of information processing costs for labor markets and suggests that an SEC mandate intended to reduce disclosure processing costs for investors caused unintended strategic responses by firms facing proprietary cost of disclosures in other markets. Data Availability: Data are available from sources identified in the text. JEL Classifications: M40; M41; J51; J52.