Publications
with Danika Wright and Jason Zein. Forthcoming, The Review of Corporate Finance Studies
An unprecedented number of firms announced CEO salary reductions at the onset of the coronavirus pandemic. We document that the total compensation for these CEOs did not actually decrease but was instead restructured, leading to a marked increase in opaque components of compensation. These adjustments align with the managerial power view of executive pay setting, whereby heightened stakeholder outrage prompts greater camouflaging of compensation to avoid scrutiny. We further show that this pattern of compensation adjustments predominantly occurred in firms with powerful CEOs, weak institutional investor monitoring, and poorer governance quality.
The replication code and data are available in the Harvard Dataverse
Featured in the CLS Blue Sky Blog, ABC News
Scientific Data 10, 237 (2023)
This paper describes a dataset capturing insider trading activity at publicly traded companies. Investors and investment analysts demand this information because executives, directors and large shareholders are expected to have more intimate knowledge of their company’s prospects than outsiders. Insider stock sales and purchases may reveal information about the firm’s business not disclosed in financial statements. They may also convey new information predictive of stock price movements if insiders can better interpret public information about the firm. Since mid-2003, the Securities and Exchange Commission has made these insider trading reports available to the public in a structured format; however, most academic papers use proprietary commercial databases instead of regulatory filings directly. This makes replication challenging as the data manipulation and aggregation processes are opaque and historical records could be altered by the database provider over time. To overcome these limitations, the presented dataset is created from original regulatory filings; it is updated daily and includes all information reported by insiders without alteration.
Featured in:
with Usha Creedy and Danika Wright. International Review of Financial Analysis (2022) 102047
Firms go public to make acquisitions, but private firms benefit from lower regulatory cost. Investment by newly public firms may be limited if managers need to focus on compliance instead of growth. Exploiting a 2012 US policy reform, we show that when regulatory cost is lower, firms make more acquisitions, do so more quickly after listing, and also increase other forms of investment. Examining potential unintended consequences of reduced regulation, we find that opportunistic bidding arising from higher information asymmetry does not explain these results. We inform the ongoing policy debate on broadening the scale and scope of regulatory relief.