Product recall data and information on stock price reactions to recalls are used estimate the value of reputation in a model which product quality is not contractible. A result defect that signals low effort. The triggers reduction firm’s value, then both rise steadily until its next occurs. We accounts for 8.3 percent firm welfare 26 first best level. policy intervention attains tax accompanie...

Firms in tradable sectors are more likely to be subject external competition limit market power, while nontradable firms dependent on domestic policies and institutions. This paper combines an antitrust index available for multiple countries with firm-level data from Orbis covering than 12 million 94 countries, including 20 over 10 years finds that profit margins of operating significantly lowe...

Innovation plays a crucial role in improving firm's performance. The relationship between innovation and productivity has been widely analysed during this decade across countries industries, generating important new findings. This study aims to provide an overall literature review on the of firms obtain comprehensive overview changing productivity. By reviewing existing empirical evidence, one ...

Abstract We analyze the supply-side disruptions associated with COVID-19. find that sectors in which a higher fraction of workforce is not able to work remotely experienced greater declines employment and expected revenue growth, worse stock market performance, likelihood default. The overweights low-exposure industries. Thus, our findings cast light on disconnect between indices aggregate outc...

Industrial agglomeration policies may limit competition. We develop, validate, and apply a novel approach for measuring competition based on the comovement of markups market shares among firms in same location industry. Then we develop model how this reduction affects aggregate income. our to well-known special economic zones (SEZs) China. estimate that SEZs exhibit cooperative pricing almost t...

SYNOPSIS Extant literature demonstrates that whistleblowing is associated with changes in the target’s financial reporting. This paper provides compelling evidence also affects peer firms’ Specifically, we find industry peers reduce their reporting aggressiveness following a allegation. deterrent effect stronger when firm geographically closer to target, and target share board member, predicted...

The canonical model of Allingham and Sandmo (1972) predicts that firms evade taxes by optimally trading off between the costs benefits evasion. However, there is no direct evidence react to audits in this way. We conducted a large-scale field experiment collaboration with tax authority address question. sent letters 20,440 small- medium-sized collectively paid more than US$200 million per year....

This paper analyzes the implications of advertising for firm dynamics and economic growth through its interaction with R&D. We develop a model endogenous heterogeneity that incorporates decisions calibrate it to match several empirical regularities across size. Our provides microfoundations empirically observed negative relationship between both R&D intensity In calibrated model, about ...

We assess whether imperfect knowledge of labor regulation hinders job creation at small and medium-sized firms. partner with a law expert organization that provides information about via newsletters access to specialized website. randomly assign 1,800 firms get this service for 21-week period. Six months later, the average employment level treatment was 12 percent higher than control The interv...

To finance unemployment insurance, states raise payroll tax rates on employers who engage in layoffs. Tax are, therefore, highest for firms after downturns, potentially hampering labor-market recovery. Using full-population, administrative records from Florida, I estimate the effect of these increases firm behavior leveraging a regression kink design schedule. hikes reduce hiring and employment...