When Anomalies Are Publicized Broadly, Do Institutions Trade Accordingly?

When Do Punishment Institutions Work?

While peer punishment sometimes motivates increased cooperation, it sometimes reduces cooperation. We use a lab experiment to study why punishment sometimes fails. We begin with a gift exchange game with punishment as it has typically been implemented therein since punishment has often backfired in this game. We modify two features of punishment that could increase its efficacy: punishment’s st...

Do Auditors Adjust Their Audit Plans Accordingly When They Encounter Material Automated Control Weaknesses?

Automated control weaknesses are associated with defects in computer hardware or computer applications. AU 319 does not require auditors to add professionals with specialized skills in automated controls (or IT audit specialists) to the audit engagement. Auditors may encounter a material automated control weakness and adjust their audit plan without the assistance of an IT audit specialists. Th...

Corporate Governance and Economic Efficiency: When Do Institutions Matter?

How do Institutional Investors Trade when Firms are Buying Back Shares?

We study how institutional investors trade when firms buy back shares. We find that aggregate institutional ownership decline following share repurchase announcements. While some institutions sell shares passively to meet the firm demand for the market to clear, the overall institutional sell-off only accounts for 27% of shares bought back contemporaneously by firms. Many firms experience a net...

Institutions, Trade and Development

I In 1961 Burenstam Linder (1961) rocked the boat of the prevailing Heckscher-Ohlin trade theory by noting that much of international trade, particularly in manufactures, was among similar countries, not between countries with disparate factor endowments (as between rich and poor countries). His explanation was in terms of demand, more trade taking place among relatively rich countries with sim...