A signal that identifies asset pricing bubbles would be valuable so investors could reposition their portfolios to weather the bubble, yet ex ante bubble identification has proven illusory. Arif and Sul (2024) study whether industry-level investment in net operating asset (NOA) accruals is an ex ante accounting-based signal that predicts bubbles. Using industry-level price run-ups across 49 countries, they find that NOA accruals predict a higher likelihood of a future crash, lower future returns, and larger analyst forecast errors, especially following run-up periods. The authors attribute these patterns to sentiment-driven overinvestment. My discussion summarizes the contributions of Arif and Sul's findings to the asset pricing bubbles, behavioral finance, and aggregate accruals literatures. I also outline empirical challenges faced by studies investigating bubbles and recommend approaches to further strengthen inferences. Finally, I propose opportunities for future research to integrate deeper accounting knowledge into bubble research.

We hypothesize that, in weak‐institution countries, firms adjust the ‘timing’ of dividend payments by committing to distribute a percentage of current earnings as dividends, revealing the extent of firm‐level agency conflicts to future investors and facilitating the raising of external capital. Consistent with this hypothesis, we find that, on average, firms in weak‐institution countries have a higher speed of adjustment ( SOA ) to their target payout ratio, pay dividends earlier in the life cycle, and are more likely to disclose a dividend policy committing to pay a minimum percentage of earnings. Within‐country tests show that, in weak‐institution countries, the firms with the highest SOA dividend policies have fewer agency problems and an increased ability to raise external capital. Finally, returns tests around earnings announcements show that high‐ SOA dividend policies are associated with larger market reactions to earnings in weak‐institution countries. Collectively, our findings suggest that dividend policy helps to alleviate agency conflicts in weak‐institution countries between firms and (future) investors.

Theoretical work generally predicts a negative association between disclosure and risk premium, where additional disclosure reduces estimation risk or information asymmetry. However, empirical studies frequently report mixed results. Recent theoretical studies suggest that the association between disclosure and risk premium is not necessarily always negative, and could be positive (or less negative). For example, Dutta and Nezlobin (2017) show that disclosure can be associated with higher risk premium when conditioned on a firm's growth rates. Similarly, Johnstone (2016) shows that higher signal quality can lead to higher risk premium. Motivated by these studies, we re-examine the association between disclosure and risk premium, conditional on growth. Using various proxies for risk premium, disclosure, and growth, we provide robust evidence that while the unconditional association between disclosure and risk premium is ambiguous, the conditional association is negative for lower growth firms but is less negative (or positive) for higher growth firms. Data Availability: Additional analyses are available from the authors upon request.