Why is it So Costly to Go Public? The average first-day returns to investors of initial public offerings (“IPOs”) in the U.S. is 19%. These returns are even higher elsewhere, such as in China. For reference, the S&P 500 index gains only a few basis points a day on average. While a large one-day return… Read More »
The views expressed in this blog post and the associated paper are solely those of the author and do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia, the Federal Reserve Board, or the Federal Reserve System. Any errors or omissions are the responsibility of the author. No statements here should be… Read More »
The rising disparity between CEO and worker pay over the past few decades has been attracting considerable attention from academics. Over the last two decades, the CEO to median employee pay ratio has been increasing for small (S&P SmallCap 600), medium (S&P MidCap 400), and large (S&P 500) firms. The literature names the managerial rent… Read More »
The past decade has witnessed a revolution in the use of massive amounts of data for businesses’ decision-making. According to a report by Forbes, there were 2.5 quintillion bytes of data created each day in 2018. Most of the time, the volume of data is too great for people to handle. Thanks to the advancement… Read More »
How would our world function if corporate criminal liability ceased to exist? This was the provocative question posed to the participants in the Journal of Corporation Law’s recently published symposium issue on corporate crime. Several of my colleagues argue for or against corporate crime’s end or survey the aftermath of such an implosion. My contribution… Read More »
Venture capital (VC) firms are notoriously secretive. In a recent paper, we examined the causes and consequences of that preference for secrecy using late-2002 court rulings that forced some of the largest public limited partners (LPs) who invest in VC funds to disclose formerly confidential return information. We show that in response to these rulings,… Read More »
New Fintech and Insurtech services are popular with consumers as they offer convenience, new capabilities and in some cases lower prices. Consumers like these technologies but do they trust them? The role of consumer trust in the adoption of these new technologies is not entirely understood. From the consumer’s perspective, there are some concerns due… Read More »
A large literature in macroeconomics argues that general equilibrium effects matter for the transmission of fiscal policy shocks. For example, government spending or taxation changes (fiscal policy) have been shown to spill over through channels such as production factor (labor, capital, etc.) reallocation, output and input price changes, household consumption and saving responses, and monetary… Read More »
Do the recently mandated human capital disclosures (HCDs) have value implications for asset prices, and if so, do they affect shareholders and debtholders in the same way? Our recent study examines the information content of newly mandated HCDs for shareholders and debtholders. Importantly, we show that firms’ HCDs are not purely boilerplate and convey information… Read More »
Over the past few decades, there has been growing concern that corporations are increasingly exerting their influence on government policymaking. The discourse in this area, both within the political arena and academia, often focuses on domestic channels that firms use to influence policymaking. This includes channels such as lobbying, political contributions, and charitable giving. However,… Read More »