Despite the rising number of green finance policies, the socioeconomic determinants shaping them remain largely unexamined. Drawing from the literature analysing the relationship between regulation, market development and institutional economics , we contend that green finance policy adoption is driven by both market-based and institutional factors. Using a survival analysis approach to understand the levers influencing green finance policy adoption across 188 countries from 2000 to 2019, we find that exposure to the fossil fuel industry predominantly drives the initial issuance of green finance policies. The positive effect of fossil fuel commercial financing on the adoption of green finance policies exists in countries with high and medium climate change awareness levels. Meanwhile, in countries with a low climate change awareness level, fossil fuel government subsidies drive green finance policy adoption. Our study also highlights the role of the financial industry as one of the key actors in the policy cycle of green finance policies via two pathways: (i) affecting financial stability through financing oil and gas companies on primary financial markets and (ii) developing a market for sustainable finance products.

Researchers have studied the entry of professionals into the public accounting field, their careers at an organization, and their exit from the field. However, they have largely overlooked the mobility of these professionals, whose careers involve firm transfers. Drawing on Bourdieu's sociology and interviews with 31 transferees and 7 non–Big 4 legacy partners, we examine the move of Big 4 professionals to non–Big 4 firms. Our findings show that transferees have an ingrained belief that a Big 4 career is the ideal professional trajectory. But they experience points of disjuncture at these firms, prompting them to reevaluate this organizational illusio and their career aspirations and ultimately reinforcing their transfer decision. After moving, transferees learn by trial and error how to valorize and layer their habitus and different forms of capital in order to adjust to the non–Big 4 firms. Our findings challenge prior assumptions about the superiority of Big 4 professionals and the distinctive forms of their capital by showing that the capital needed to obtain powerful positions at Big 4 and non–Big 4 firms are similar, but that its nature and relative value varies. Our findings reveal a paradoxical dynamic in which transferees' Big 4 habitus and capital undergo a complex, iterative process of valorization and layering when these professionals move within the public accounting field. This contrasts with a materialization of professional domination that occurs when former Big 4 employees move outside the public accounting field. For most of our transferees, dissonance also develops between the Big 4 and non–Big 4 layers of their habitus, and they never completely deconstruct their organizational illusio. These findings reveal that the reflexivity of transferees is both shaped and limited by their Big 4 habitus and illusio. Overall, our results contribute to the understanding of professional mobility within the public accounting field.

We explore information spillovers and cross-monitoring between the stock and loan markets, focusing on the roles of short sellers and banks. Using Regulation SHO that directly affects short-selling constraints in the stock market but is exogenous to the loan market, we find that only those firms without bank monitors exhibit significant stock price declines upon the announcement of SHO. We also document that while short interest increases following SHO, it increases far less for firms with bank monitors. Using bank and lending relationship characteristics, we find SHO returns increase in the bank's ability and incentive to monitor. Our exploration of equity ownership structure reveals that the presence of block holders and dedicated owners has little to no effect on our results, suggesting that bank monitors complement shareholder monitoring efforts.

We study markup cyclicality in a granular macroeconomic model with oligopolistic competition. We first characterize how firm, sectoral, and aggregate markups comove with output at different levels of aggregation in response to firm-level shocks. We quantify the model’s ability to reproduce salient features of the cyclical properties of measured markups in French administrative firm-level data from the bottom (firm) level to the aggregate level. We document that (i) firm-level markups rise with market share and sector-level markups with concentration, (ii) the relationship between markups and sectoral output varies by firm size—negative for small firms but positive for large ones, (iii) sector-level markups move positively with sectoral output, and (iv) sectoral markups show no systematic relationship with aggregate output. Our model helps rationalize these seemingly conflicting patterns of markup cyclicality in the data.

Auditors at all ranks should be skeptical when searching for information throughout audits. However, we lever domain learning theory from educational psychology to posit that their skepticism unlikely develops evenly across ranks, but rather depends on a supportive learning culture, a construct from the management literature. To test that perceived learning culture moderates the association between auditor rank and skeptical information search, we use a laboratory study with 166 Dutch auditors at a Big 4 firm and follow-up interviews with seven top leaders of that firm. A more supportive perceived learning culture is associated with more skeptical information search, but only in audit managers and partners - not in associates and seniors. Interviewees attribute this pattern to values acquired over time through socialization, role expectations, knowledge development, and wider task characteristics.

Many CEOs engage in activism by publicly expressing their views on social, environmental, and political issues, while other CEOs refrain from doing so—a behavior we term CEO inactivism. We use two experiments to examine how CEO (in)activism impacts investor decisions. Our results are consistent with our theoretical predictions. When a CEO expresses an activist position that is consistent versus inconsistent with investors' views, investors invest more in the CEO's firm because they perceive the CEO more positively. We also find that CEO inactivism can lead to investment decisions that are as favorable as when the CEO expresses a position consistent with investors' views; our process evidence suggests that this may occur because CEO inactivism increases the likelihood that investors believe the CEO shares their position on a social issue. Finally, we do not find evidence that investor decisions are influenced by whether CEO (in)activism is in response to an external prompt. This study contributes to the emerging literature on CEO activism, a unique form of voluntary disclosure, by providing evidence about how CEO (in)activism influences investors. We also contribute to the literature examining the impact of social media disclosure on investor decisions. Finally, our findings have practical implications for CEOs, who increasingly face external pressures to engage in activism.

We develop a model of competition in prices and infrastructure among mobile network operators. Although consolidation increases market power, it can lead to more efficient data transmission due to economies of scale, which we derive from physical principles. After estimating our model with French consumer and infrastructure data, equilibrium simulations reveal that while prices decrease with the number of firms, so do download speeds. Our framework also allows us to quantify the impact of spectrum allocation. The marginal social value of spectrum exceeds firms’ willingness to pay in our model as well as observed prices in spectrum auctions.

We examine California Assembly Bill No. 979 (AB 979), the first law mandating racial, ethnic, and other forms of diversity on corporate boards. Conventional t-tests show that stock returns around the enactment of the law are negative, economically large, and statistically significant; returns are more negative for smaller firms and firms with no diverse directors, suggesting higher compliance costs. However, statistical significance disappears after controlling for event date cross-correlation, when comparing returns on event dates to the pre-event distribution of returns, and in multivariate regressions. At least 90 % of firms comply with the first stage of AB 979 and the qualifications of mandated directors are largely similar to those of benchmarks, suggesting compliance costs are low. We also find no evidence that compliance affects firm operating performance. Overall, our results suggest that the diversity mandate has statistically and economically small effects relative to typical variation in stock returns and firm outcomes, which highlights the importance of considering appropriate counterfactuals and examining multiple dimensions when analyzing the impact of such mandates.

Binsbergen, Han, and Lopez-Lira (2023) predict analysts’ forecast errors using a random forest model. A strategy that trades against this model’s predictions earns a monthly alpha of 1.54% ($ t $-value = 5.84). This estimate represents a large improvement over studies using classical statistical methods. We attribute the difference to a look-ahead bias. Removing the bias erases the alpha. Linear models yield as accurate forecasts and superior trading profits. Neither alternative machine learning models nor combinations thereof resurrect the predictability. We discuss the state of research into the term structure of analysts’ forecasts and its causal relationship with returns.