We examine the effects of time-limited disclosure relief under the Jumpstart Our Business Startups (JOBS) Act of 2012. The Act grants newly public firms up to five years of exemptions, and our results suggest that the fixed duration of this relief, as much as its availability, shapes post-IPO behavior. Using an intention-to-treat design, we compare treated firms with smaller reporting companies whose exemptions are similar but carry no fixed expiry date. Equity issuance by treated firms increases significantly as the deadline nears while debt issuance declines, and cash reserves accumulate over the period. Capital expenditure increases relative to controls in the early post-IPO years, while R&D shows no differential response. As expiry approaches, the differential with the control group in internal investment weakens but cash-financed acquisitions accelerate. This shift in investment composition coincides with deteriorating operating performance and declining market valuations relative to IPO levels. Our post-expiry analysis reveals an abrupt reversal in acquisition activity upon transition to full disclosure while internal investment remains unchanged, supporting the argument that pre-expiry behavior was driven by the regulatory timeline rather than natural firm maturation. We conclude that the duration of regulatory relief is as important as its scope in shaping corporate behavior, and that time-limited exemptions from mandatory disclosure can induce anticipatory firm responses that work against the policy's intended objectives.

Internal labor markets are increasingly important for matching workers to jobs within organizations. We present evidence from a randomized trial that compares matching workers to jobs using the deferred acceptance (DA) algorithm to the traditional manager‐directed matching process. Our setting is the U.S. Army's internal labor market, which matches over 14,000 officers to units annually. We find that DA reduces administrative burden and increases match quality as measured by reduced justified envy, increased truthful preference reporting, and officers' and units' preferences over their matches. The overall impact of DA on officer retention and performance in the two years after officers started their new jobs is limited by strategic preference coordination between officers and units. However, DA leads to significant improvements in officer retention and promotions in markets with inexperienced managers. Our findings suggest that cross‐market communication between agents in internal labor markets can attenuate the benefits of strategyproof matching algorithms.

This article documents adverse selection in Ginnie Mae issuers’ early buyout decisions. Conditional on default, we find a 1 percentage point increase in interest rate spread increases the probability of an early buyout by 7–9 percentage points. Issuers buy out higher interest rate spread loans because they generate greater economic gains when they reperform. We illustrate how issuers acquire private soft information that provides direct insight into the likelihood of reperformance. Although the soft information is ostensibly collected on behalf of investors during the delinquent loan servicing process, issuers can exploit the information in their early buyout decisions.

Using Danish registry data linked to the Labor Force Survey, we provide the first rigorous evidence with external validity on the hours-career nexus (positive association between hours and career success). Guided by three theories (human capital; rat race; tournament), we unpack the hours-career nexus through examining: the differential effect of hours in the present firm and elsewhere; hours relative to peers’ hours; standard vs. evening/night/weekend hours; and the importance of sustaining long hours. Supplemented by the time use survey, we show the gender gap in hours and career success is due mostly to gendered division of labor in household production.

We develop a model-free measure of the variance premium by constructing option portfolios whose returns are highly correlated with realized stock variance. This effectively decomposes returns into realized variance minus implied variance. We apply this decomposition to document a novel quarterly cross-sectional continuation pattern in both realized variance and implied variance of individual stocks. Implied variance underanticipates the seasonality of realized variance, so options that performed well at quarterly lags continue to earn high returns in the future. Quarterly periodicity in realized stock variance only occurs on days with analyst earning revisions, suggesting an informational channel for this pattern.

In many markets, buyers make discrete choices between differentiated products and negotiate prices that are specific to the choice. We develop for estimation a model for this class of markets which is consistent with non-cooperative models of bargaining between a buyer and competing sellers. We show that when the buyer’s utility has GEV disturbances, the model has a tractable likelihood function which can be used with transaction-level data giving the selected product and its price. We estimate the model using data from the UK brick industry and use it to measure market power and analyse mergers. We analyse how spatial differentiation and ownership concentration affect the distribution of market power across transactions. In counterfactuals we find that switching from individually negotiated to uniform pricing causes markups, and merger price effects, to increase on average but to decrease for a minority of transactions.

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.

We examine the impact of Internal Revenue Service (IRS) Code Section 4960 of the Tax Cuts and Jobs Act of 2017 on nonprofit organizations (NPOs). This section imposes a 21% excise tax on nonprofit employee compensation exceeding $1 million per covered individual. As this is an exogenous shock imposing a cost on NPOs with highly paid employees, it leads us to examine whether those employees share the newly added cost via a reduction in their compensation. Using a difference‐in‐differences analysis on data from IRS Form 990 filings for nearly 40,000 nonprofit employee‐year observations from 2015 to 2010, we find that the level of compensation, on average, increases for treated executives in the post–Section 4960 period, but at a slower rate than that of the control group of executives. These results are consistent with highly paid employees being reluctant, on average, to take a pay cut, but being more willing to accept a reduction in their rate of pay growth. Our results are robust to alternative treatment specifications and control samples, such as employees who earn more than $1 million but are not covered under Section 4960 and medical professionals who are specifically exempt from Section 4960. We also find that compensation decreases are more likely for treated employees post–Section 4960 and that replacements for treated CEOs take an even steeper pay cut post–Section 4960. Additionally, we observe increased turnover for treated CEOs post–Section 4960, consistent with Section 4960 leading to conflicts between treated CEOs and their boards regarding the excise tax and who should bear its cost.

The annual proportion of U.S. public firms that reported a financial covenant violation fell roughly 70% between 1997 and 2019. To understand this trend, we develop an estimable model of covenant design that depends on the ability to differentiate between distressed and nondistressed borrowers and the relative costs associated with screening incorrectly. We find that the drop in violations is best explained by an increased willingness to forgo early detection of distressed borrowers in exchange for fewer inconsequential violations, which we attribute largely to a shift in the composition of public borrowers and partly to heightened investor sentiment during the 2010s.

We construct a public atlas of mean outcomes in adulthood by childhood census tract. Outcomes vary sharply across neighborhoods: For children whose parents earn $27,000, the standard deviation of mean household income in adulthood is $10,420 across tracts within counties. Only half the variation in outcomes is explained by traditional measures of neighborhood opportunity like poverty rates. Experimental and quasi-experimental estimates indicate 60 percent of the variation in outcomes across neighborhoods is driven by causal effects. We demonstrate how our statistics can be applied to better target policies to improve low-opportunity areas and help families move to affordable high-opportunity areas.