Information is central to consumer credit, but little is known about its equilibrium effects. We study a 2017 natural experiment in which non-bankruptcy public records were purged from U.S. credit reports. The large information-removal differences across states allow us to identify equilibrium impacts. Available credit increased for consumers who lost negative information directly. Consistent with our model, available credit declined indirectly for consumers who did not lose the negative information because they could no longer distinguish themselves. The direct and indirect effects nearly canceled, so the net equilibrium effect after a year was nearly zero but with substantial redistribution.

Previous studies of the effect of ridesharing on traffic fatalities have yielded inconsistent conclusions. We revisit this question using proprietary data from Uber measuring monthly rideshare activity at the Census tract level. We find a consistent negative effect of ridesharing on traffic fatalities, with impacts concentrated during nights and weekends. Our results imply that ridesharing has decreased U.S. traffic fatalities by 5.2% in areas where it operates. The annual life-saving benefits are $6.8 billion. Back-of-the-envelope calculations suggest that these benefits are of similar magnitude to producer surplus captured by Uber shareholders or consumer surplus captured by Uber riders.

Numerous trading strategies examined in options research exhibit remarkably high mean returns and Sharpe ratios. We show some of these seemingly “good deals” are due to look-ahead biases. These biases stem from using information unavailable at the portfolio formation time to filter out observations suspected of being noisy or erroneous. Our results suggest that elevated Sharpe ratios may serve as potential indicators of such look-ahead biases. Furthermore, deviating from previous literature findings, we show that illiquidity is not strongly priced in stock options and that only a small set of stock characteristics are in fact associated with option expected returns.

Aid fragmentation—the simultaneous operation of multiple development agencies in one setting—has long raised concerns about coordination challenges and opportunities for corruption. Leveraging unique data on project delivery in Afghanistan, we present the first microlevel empirical analysis of aid fragmentation. We find that aid delivered by a single donor can significantly reduce corruption. Projects delivered under conditions of aid fragmentation, by contrast, can facilitate corruption. We find evidence for a theoretical mechanism linking infrastructure and physical goods with waste and leakage. Our results clarify the policy losses tied to fragmentation, yielding insights for combating misappropriation of aid.

This article empirically studies the effects of the early law and economics movement on the U.S. judiciary. We focus on the Manne Economics Institute for Federal Judges, an intensive economics course that trained almost half of federal judges between 1976 and 1999. Using the universe of published opinions in U.S. Circuit Courts and 1 million District Court criminal sentencing decisions, we estimate the within-judge effect of Manne program attendance. Selection into attendance was limited, as the program was popular among judges of all backgrounds, frequently oversubscribed, and admitted participants on a first-come, first-served basis. We find that after attending economics training, participating judges use more economics language in their opinions, rule against regulatory agencies more often, and impose more severe criminal sentences. We argue that economics, as a rigorous social science, was especially effective in persuading judges.

Discretionary announcement timing generates high conditional risk premia of stock returns and a pattern of negative drifts followed by positive jumps. Average announcement returns are much larger than unconditional risk premia. Capital Asset Pricing Model alphas turn negative when conditioning on nondisclosure because betas rise faster than risk premia prior to disclosures, but average announcement returns may appear to be too large relative to market risk when betas are estimated from past returns. The effects are amplified when multiple firms exercise discretion over the timing of correlated announcements. We present evidence that firms time earnings announcements in a manner consistent with our model.

Regulators of new products confront a trade-off between speeding a product to market and collecting additional product quality information. The FDA's Breakthrough Therapy Designation (BTD) provides an opportunity to understand if regulators can use new policy to innovate around this trade-off. We find that the BTD program shortened clinical development times by 23% and did not affect the ex post safety profile of drugs with the designation. The BTD program had the greatest impact on less experienced firms and reduced clinical trial design complexity. The results suggest that targeted regulatory innovation can shorten R&D periods without compromising product quality.

We study the effects of the largest corporate income tax cut in U.S. history on firms and workers. To identify causal effects, we use employer-employee matched tax records and event studies comparing similarly sized firms in the same industry that faced divergent tax changes due to their pre-existing legal status. Tax cuts cause increases in firms' investment, sales, profits, employment, and payrolls, with earnings gains concentrated among highly paid workers. In the short-run, 87% of private income gains flow to the top 10% of the income distribution.