This article assesses the long-run effects of the 1989 Canada-U.S. Free Trade Agreement on the Canadian labour market using matched longitudinal administrative data for the years 1984–2004. We simultaneously examine the labour market effects of increased export expansion and import competition, generally finding adverse effects of Canadian tariff cuts and favourable effects of U.S. cuts, though both effects are small. Workers initially employed in industries that experienced larger Canadian tariff concessions exhibit a heightened probability of layoffs at large firms, but little impact on long-run cumulative earnings. Lower earnings and years worked at the initial employer are offset by gains in other manufacturing industries, construction, and services. Canadian workers quickly transitioned out of industries facing import competition, with the bilateral nature of the FTA providing import-competing workers employment options in alternative manufacturing industries benefiting from larger U.S. tariff cuts.

Multinationals in the extractive sectors of weak states face resource theft by armed groups. Criminality is often abetted by state corruption, even though firms are willing to pay for protection. I study indigenization in Nigeria’s oil sector, which increased local firms’ participation substantially. Despite lower quality, local firms increase output by reducing oil theft. A bargaining model illustrates that political connections align law enforcement incentives, solving commitment problems. Data on law enforcement raids show that local firms receive preferential protection. Connections to military elites drive the local advantage. The aggregate gains from indigenization are at most between 2.3 and 5.7 percent of GDP.

This paper examines which municipal disclosures provide informational value to investors. Using the entire universe of post-issuance financial and event disclosures from 2009 to 2022, we find that most municipal bonds do not trade in the weeks following a disclosure. However, some disclosures do provide enough new information to increase trading. Investors trade more on credit-relevant disclosures, such as adverse credit event disclosures, and less on required annual financial statements. Trading after disclosures also increases more when a bond is large or risky. Moreover, we find that credit rating agencies respond to disclosures, lending support to the idea that some disclosures have informational value. In further analyses, we find that trading before the disclosure, lack of timeliness, illiquidity, and information processing constraints contribute to the limited trading on the average disclosure. The findings suggest that reconsidering a one-size-fits-all approach to regulating post-issuance municipal disclosures may be worthwhile.

This study examines how government support influences firm behavior across profitability, investment, and employment. Using a comprehensive database linking local, state, and federal subsidies to firm-level financial data, we assess how different subsidy types shape firm decisions. We find that cost-reducing subsidies are more effective than revenue-increasing ones in boosting profitability, employment, and strategic investment. Firms that commit to hiring or capital investment upon receiving subsidies achieve superior outcomes. These findings highlight the importance of aligning subsidy design with firm-level incentives and broader economic goals.

The Inflation Reduction Act of 2022 imposes a 1 % excise tax on US corporate share repurchases, effective January 1, 2023. The tax's implementation is associated with a significant decline in corporate repurchases that is not offset by a corresponding increase in dividends. Aggregate repurchases decline from about $1 trillion in 2022 to just over $800 billion in 2023, and the average firm reduces quarterly repurchases (as a fraction of market capitalization) by roughly 25 %. The decline in repurchases by US firms far exceeds a contemporaneous decline in repurchases by Canadian firms, is large in a historical context, and is not driven by firm fundamentals. Tax-induced cuts to repurchases are associated with an increase in cash but no increase in investment, implying that the tax has not generated the stated policy objective.

We consider a procurement auction for the provision of a basic service to which an add-on must later be appended. Potential providers are symmetric, have private information on their cost for the basic service and the winning firm must also implement the add-on. To finance value-enhancing activities related to the add-on, this firm may need extra funding by outside financiers. Nonverifiable effort related to these activities creates a moral hazard problem which makes the firm’s payoff function for the second period concave in returns over the relevant range. Concavity has two effects. First, it makes it more attractive to backload payments to facilitate information revelation. Second, uncertainty on the cost of the add-on introduces a background risk which requires a risk premium. In this context, we characterize the optimal intertemporal structure of payments to the winning firm, equilibrium bidding behaviour and reserve prices for a first-price auction.

Prior research demonstrates that audit professionals encounter client incivility. We extend this research by examining whether client incivility negatively impacts auditors' judgments and whether any adverse effects are reduced when auditors use coping strategies. We first collect descriptive survey evidence revealing that client incivility toward auditors is more widespread than currently documented. Next, using an experiment, we predict and find that auditors who experience client incivility (vs. those who do not) are less likely to challenge aggressive reporting if they are not prompted to cope. We also find that active coping reduces the adverse impact of client incivility, whereas findings for passive coping are inconclusive. Audit standards and users of financial statements expect auditors to fulfill their duty of maintaining a high level of professional skepticism irrespective of external circumstances. Our findings highlight the challenges auditors face in meeting these expectations when facing uncivil clients, thus posing a threat to audit quality.

We synthesize the literature on economic epidemiology, the interdisciplinary field that draws on the ideas and methods of economics to analyze individual behavior, aggregate disease dynamics, and public policy during infectious disease epidemics. We cover the main models of individual behavior during epidemics, related econometric evidence, and models of disease dynamics appropriate for the analysis of a range of infectious diseases. We outline modeling approaches to a range of control measures including non-pharmaceutical interventions such as stay-at-home mandates, quarantines, and sheltering, and pharmaceutical interventions such as vaccines and treatment. Last, we characterize different types of externalities and heterogeneities and discuss the targeting and implementation of policies through restrictions and incentives.

Fatigue and burnout are root causes of audit quality issues and turnover. Leveraging the job demands‐resources theory, we investigate whether two mechanisms can reduce accountants' fatigue and, in turn, improve audit quality. We conduct a field study of public accountants during both normal and busy season work periods, collecting bi‐daily logs to examine whether the use of microbreaks (i.e., brief respite activities) as a job crafting mechanism and/or the receipt of supervisory support as a job resource lessen end‐of‐day fatigue. We posit and find that engaging in microbreaks is associated with reduced end‐of‐day fatigue within busy season. Similarly, we posit and find that higher levels of daily supervisory support during busy season are associated with lower end‐of‐day fatigue. However, neither of these mechanisms is associated with lower end‐of‐day fatigue during normal work periods. Our results also indicate that these two mechanisms function as complements during busy season, with either one significantly reducing end‐of‐day fatigue, but both together having an interactive effect. Further, end‐of‐day fatigue during busy season reduces sleep quality, which increases accountants' fatigue the following morning. In a follow‐up experiment, we consistently find evidence that a 1‐min microbreak reduces fatigue and that this reduction directly translates into improved error detection.

We examine how relative performance evaluation (RPE) affects industry competition—a question relevant for corporate boards interested in incentivizing executives. Using U.S. airline data, we estimate a dynamic game of competition between heterogeneous firms in an oligopolistic market, with managers incentivized by RPE contracts. While RPE can induce a firm to compete more intensely by smoothing compensation, it also amplifies a firm’s cost efficiency relative to its peers and can weaken competition from inefficient firms. The first effect dominates in small markets and the second in median-sized markets. RPE has little effect in large, highly profitable markets.