Showing papers on "Earnings published in 2020"
TL;DR: In this paper, the authors present real-time survey evidence from the UK, US and Germany showing that the immediate labor market impacts of Covid-19 differ considerably across countries.
900 citations
TL;DR: The authors showed that 20% of debt by value is based on assets (asset-based lending in creditor parlance), whereas 80% is based predominantly on cash flows from firms' operations.
Abstract: Macro-finance analyses commonly link firms’ borrowing constraints to the liquidation value of physical assets. For U.S. nonfinancial firms, we show that 20% of debt by value is based on such assets (asset-based lending in creditor parlance), whereas 80% is based predominantly on cash flows from firms’ operations (cash flow–based lending). A standard borrowing constraint restricts total debt as a function of cash flows measured using operating earnings (earnings-based borrowing constraints). These features shape firm outcomes on the margin: first, cash flows in the form of operating earnings can directly relax borrowing constraints; second, firms are less vulnerable to collateral damage from asset price declines, and fire sale amplification may be mitigated. Taken together, our findings point to new venues for modeling firms’ borrowing constraints in macro-finance studies.
133 citations
TL;DR: In this article, the authors construct publicly available statistics on parents' incomes and students' earnings outcomes for each college in the United States using deidentified data from tax records and link these income data to SAT and ACT scores, and simulate how changes in the allocation of students to colleges affect segregation and intergenerational mobility.
Abstract: We construct publicly available statistics on parents’ incomes and students’ earnings outcomes for each college in the United States using deidentified data from tax records. These statistics reveal that the degree of parental income segregation across colleges is very high, similar to that across neighborhoods. Differences in postcollege earnings between children from low- and high-income families are much smaller among students who attend the same college than across colleges. Colleges with the best earnings outcomes predominantly enroll students from high-income families, although a few mid-tier public colleges have both low parent income levels and high student earnings. Linking these income data to SAT and ACT scores, we simulate how changes in the allocation of students to colleges affect segregation and intergenerational mobility. Equalizing application, admission, and matriculation rates across parental income groups conditional on test scores would reduce segregation substantially, primarily by increasing the representation of middle-class students at more selective colleges. However, it would have little effect on the fraction of low-income students at elite private colleges because there are relatively few students from low-income families with sufficiently high SAT/ACT scores. Differences in parental income distributions across colleges could be eliminated by giving low- and middle-income students a sliding-scale preference in the application and admissions process similar to that implicitly given to legacy students at elite private colleges. Assuming that 80% of observational differences in students’ earnings conditional on test scores, race, and parental income are due to colleges’ causal effects—a strong assumption, but one consistent with prior work—such changes could reduce intergenerational income persistence among college students by about 25%. We conclude that changing how students are allocated to colleges could substantially reduce segregation and increase intergenerational mobility, even without changing colleges’ educational programs.
124 citations
TL;DR: The authors studied the impact of changing job skills on career earnings dynamics for college graduates and found that the returns to work experience are a race between on-the-job learning and skill obsolescence.
Abstract: This article studies the impact of changing job skills on career earnings dynamics for college graduates We measure changes in the skill content of occupations between 2007 and 2019 using detailed job descriptions from a near universe of online job postings We then develop a simple model where the returns to work experience are a race between on-the-job learning and skill obsolescence Obsolescence lowers the return to experience, flattening the age-earnings profile in faster-changing careers We show that the earnings premium for college graduates majoring in technology-intensive subjects such as computer science, engineering, and business declines rapidly, and that these graduates sort out of faster-changing occupations as they gain experience
89 citations
TL;DR: The profitability of large pharmaceutical companies was significantly greater than other large, public companies, but the difference was less pronounced when considering company size, year, or research and development expense.
Abstract: Importance Understanding the profitability of pharmaceutical companies is essential to formulating evidence-based policies to reduce drug costs while maintaining the industry’s ability to innovate and provide essential medicines. Objective To compare the profitability of large pharmaceutical companies with other large companies. Design, Setting, and Participants This cross-sectional study compared the annual profits of 35 large pharmaceutical companies with 357 companies in the SP earnings before interest, taxes, depreciation, and amortization (EBITDA; pretax profit from core business activities); and net income, also referred to asearnings(difference between all revenues and expenses). Profit measures are described as cumulative for all companies from 2000 to 2018 or annual profit as a fraction of revenue (margin). Results From 2000 to 2018, 35 large pharmaceutical companies reported cumulative revenue of $11.5 trillion, gross profit of $8.6 trillion, EBITDA of $3.7 trillion, and net income of $1.9 trillion, while 357 SP difference, 39.1% [95% CI, 32.5%-45.7%];P Conclusions and Relevance From 2000 to 2018, the profitability of large pharmaceutical companies was significantly greater than other large, public companies, but the difference was less pronounced when considering company size, year, or research and development expense. Data on the profitability of large pharmaceutical companies may be relevant to formulating evidence-based policies to make medicines more affordable.
81 citations
TL;DR: This paper found that early exposure to depressed labor market lowers health and raises mortality in middle age, patterns accompanied by a reopening of earnings gaps and that adverse initial labor market entry also has persistent effects on a range of social outcomes, including timing and completed fertility, marriage and divorce, criminal activities, attitudes, and risky alcohol consumption.
Abstract: Unlucky young workers entering the labor market in recessions suffer a range of medium- to long-term consequences. This paper summarizes the findings of the growing empirical literature on this subject and uses it to assess economic models of career development. The literature finds large initial effects on earnings, labor supply, and wages that tend to fade after ten to fifteen years in the labor market, and that are accompanied by changes in occupation, job mobility, and employer characteristics. Adverse initial labor market entry also has persistent effects on a range of social outcomes, including timing and completed fertility, marriage and divorce, criminal activities, attitudes, and risky alcohol consumption. There is also evidence that early exposure to depressed labor market lowers health and raises mortality in middle age, patterns accompanied by a reopening of earnings gaps.
78 citations
TL;DR: This article showed that the Fair Labor Standards Act extended federal minimum wage coverage to agriculture, restaurants, nursing homes, and other services that were previously uncovered and where nearly a third of black workers were employed.
Abstract: The earnings difference between white and black workers fell dramatically in the United States in the late 1960s and early 1970s. This article shows that the expansion of the minimum wage played a critical role in this decline. The 1966 Fair Labor Standards Act extended federal minimum wage coverage to agriculture, restaurants, nursing homes, and other services that were previously uncovered and where nearly a third of black workers were employed. We digitize over 1,000 hourly wage distributions from Bureau of Labor Statistics industry wage reports and use CPS microdata to investigate the effects of this reform on wages, employment, and racial inequality. Using a cross-industry difference-in-differences design, we show that earnings rose sharply for workers in the newly covered industries. The impact was nearly twice as large for black workers as for white workers. Within treated industries, the racial gap adjusted for observables fell from 25 log points prereform to 0 afterward. We can rule out significant disemployment effects for black workers. Using a bunching design, we find no aggregate effect of the reform on employment. The 1967 extension of the minimum wage can explain more than 20% of the reduction in the racial earnings and income gap during the civil rights era. Our findings shed new light on the dynamics of labor market inequality in the United States and suggest that minimum wage policy can play a critical role in reducing racial economic disparities.
74 citations
TL;DR: This paper studied the impact of public audit oversight on financial reporting credibility and found that investors respond more strongly to earnings news following public audit supervision, and that this credibility is priced in capital markets.
Abstract: This paper studies the impact of public audit oversight on financial reporting credibility. We analyze changes in market responses to earnings news after public audit oversight is introduced, exploiting that the regime onset depends on fiscal year-ends, auditors, and the rollout of auditor inspections. We find that investors respond more strongly to earnings news following public audit oversight. Corroborating these findings, we find an increase in volume responses to 10-K filings after the new regime. Our results show that public audit oversight can enhance reporting credibility and that this credibility is priced in capital markets.Authors have furnished an Internet Appendix, which is available on the Oxford UniversityPress Web site next to the link to the final published paper online.
72 citations
TL;DR: In this paper, the authors examined how the ownership structure and board of directors' features determine the managerial opportunistic behavior exemplified in the management of accounting earnings, and found evidence that earnings management is reduced as the voting rights of the controlling shareholder increased and that there is an inverse U-shaped relationship between insiders' ownership and the earnings manipulation.
Abstract: This paper examines how the ownership structure and board of directors' features determine the managerial opportunistic behavior exemplified in the management of accounting earnings. This study contributes to the literature by investigating the relationship of firm‐level and country‐level corporate governance systems on the earnings management in the Spanish corporate sector. Results reveal that the varying efficiency of the corporate governance systems is reflected in the way in which accounting discretion is performed. We found evidence that earnings management is reduced as the voting rights of the controlling shareholder increased and that there is an inverse U‐shaped relationship between insiders' ownership and the earnings manipulation. Regarding the board characteristics, we observe that larger, independent boards, those with a larger proportion of female members, and those with an audit committee compounded by a greater proportion of outside independent directors oversee managers more efficiently, constraining their capacity to manage earnings. To the contrary, board duality increases the likelihood of opportunistic manipulation of financial reporting. We found that when the institutional environment improves in the Spanish context, the discretionary power of the corporate sector to overstate the financial statements is reduced. The findings prove the necessity of reinforcing the rules and regulations toward a more transparent disclosure of the financial statements.
71 citations
TL;DR: The authors investigated whether managerial ability is related to income smoothing and, if so, whether smoothing associated with managerial ability improves the informativeness of earnings and showed that managerial ability was positively associated with smoothing.
Abstract: In this study, we investigate whether managerial ability is related to income smoothing and, if so, whether smoothing associated with managerial ability improves the informativeness of earnings and...
70 citations
TL;DR: In this paper, the authors used the number of months of education closures to estimate the loss in marginal future earnings and found that the school closures reduce future earnings, and this loss is equivalent to 15 percent of future gross domestic product.
Abstract: Social distancing requirements associated with COVID-19 (coronavirus) have led to school closures. In mid-April, the United Nations Educational, Scientific and Cultural Organization reported that 192 countries had closed all schools and universities, affecting more than 90 percent of the world's learners: 1.5 billion children and young people. The closures are expected to reduce learning and will lead to future losses in earnings and labor productivity. Schooling attainment leads to increased earnings. What is not known is how much earnings will decline due to the school closures. Starting with the fact that every year of schooling equates to 8-9 percent in additional future earnings, this paper uses the number of months of education closures to estimate the loss in marginal future earnings. The findings show that the school closures reduce future earnings, and this loss is equivalent to 15 percent of future gross domestic product. The school closures will have a large and long-lasting impact on the earnings of future workers. It is also likely that students from low-income countries will be affected most. These estimates are conservative, assuming that the closures will end after four months and school quality will not suffer.
TL;DR: In this article, the analysis of annual earnings before interest and taxes (EBIT) of 5,640 enterprises from the Visegrad Four during the period 2009-2018 confirms that the development of earnings management in these countries is not a randomness.
Abstract: Research background: Enterprises manage earnings in an effort to balance their profit fluctuations to provide increasingly consistent earnings in every reporting period Earnings management is legal and very effective method of accounting techniques and may be used to obtain specific objectives of the enterprises involving the manipulation of accruals Therefore, there is a need to analyze it in the context of group of countries, while the issue of their detection in the new ways appears
Purpose of the article: The analysis of annual earnings before interest and taxes (EBIT) of 5,640 enterprises from the Visegrad Four during the period 2009?2018 confirms that the development of earnings management in these countries is not a randomness Thus, the aim of this article is to determine the existence of positive trend in earnings management and to detect the change-point in its development for each Visegrad country
Methods: Grubbs test, Mann-Kendall trend test and Buishand test were used as appropriate statistical methods Mann-Kendall test identifies significant monotonic trend occurrence in earnings manipulation in every country Buishand test indicates significant years, which divides the development of EBIT into two homogenous groups with individual central lines
Findings & Value added: Based on the statistical analysis applied, we rejected randomness in the managing of earning, but we determined the trend of its increasing The positive earnings manipulation was not homogenous in the analyzed period, however, a change-point was defined Year 2014 was identified as a break-point for Slovak, Polish and Hungarian enterprises considering the earnings manipulation Year 2013 was detected as a change-point in Czech enterprises The methodical approach used may be very helpful for researchers from other countries to determine, detect and understand earnings management as well as for the investors to make decisions based on a specificities of an individual country
TL;DR: In this article, the authors analyze firm-level analyst forecasts during the COVID crisis and decompose discount rate changes into three factors: changes in unlevered asset risk premium (0), increased leverage (+1%) and interest rate reduction (-1%).
Abstract: We analyze firm-level analyst forecasts during the COVID crisis. First, we describe expectations dynamics about future corporate earnings. Downward revisions have been sharp, mostly focused on 2020, 2021 and 2022, but much less drastic than the lower bound estimated by Gormsen and Koijen (2020). Analyst forecasts do not exhibit evidence of over-reaction: As of mid-May, forecasts over 2020 earnings have progressively been reduced by 16%. Longer-run forecasts, as well as expected “Long-Term Growth” have reacted much less than short-run forecasts, and feature less disagreement. Second, we ask how much discount rate changes explain market dynamics, in an exercise similar to Shiller (1981). Given forecast revisions and price movements, we estimate an implicit discount rate going from 10% in mid-February, to 13% at the end of March, back down to their initial level in mid-May. We then decompose discount rate changes into three factors: changes in unlevered asset risk premium (0%), increased leverage (+1%) and interest rate reduction (-1%). Overall, analyst forecast revisions explain all of the decrease in equity values between January 2020 and mid May 2020, but they do not explain shorter term movements.
TL;DR: To retain sustained earnings and development, green manufacturing should be the bottom line of involved firms and the importance of corporate stakeholders should be promoted in consideration of enterprises’ practice performance and future development.
Abstract: This study explores the relationship among stakeholders, green manufacturing, and practice performance in the fashion business in China and focuses on assisting companies to enhance environmental awareness and green manufacturing practices. We collect research data by developing questionnaires for various Chinese enterprises. A five-point Likert scale is adopted to enable respondents to indicate the extent to which they agree with the items. Through tests and analyses, the questionnaire is validated as reliable, the structural equation model has a good fitting degree, and hypotheses are proved true. Specifically, corporate stakeholders have a significant positive impact on green manufacturing and practice performance, and green manufacturing has a significant positive impact on practice performance in the context of Chinese fashion businesses. Moreover, corporate stakeholders can have a positive impact on practice performance through green manufacturing. We also propose some policy implications, including implementing compulsive policies and regulations and encouraging and establishing preferential policies, such as tax concessions. Moreover, enterprises should actively strive to improve green manufacturing technology and management level to ensure the smooth implementation of green manufacturing practices. To retain sustained earnings and development, green manufacturing should be the bottom line of involved firms. We also emphasize that the importance of corporate stakeholders should be promoted in consideration of enterprises’ practice performance and future development.
TL;DR: Examining the extent to which different earnings groups and sociodemographic groups became exposed to economic hardship between March and May of 2020, results indicate that lower earnings groups were more than twice as likely to experience economic hardship relative to top quintile earners.
TL;DR: In this paper, the authors found evidence that highly narcissistic CEOs engage in accrual-based earnings management (ABEM), which is related to low earnings quality in that it is associated to discretionarily decreasing accruals.
Abstract: Corroborating upper echelons theory, this study picks up the notion that narcissistic chief executive officers (CEOs) take advantage of accounting choices to enhance their firms’—and inherently their own—personal track records. Using a set of 15 indicators, reflecting the narcissistic trait of 1126 CEOs for the period 1992 to 2012, we find evidence of highly narcissistic CEOs engaging in accrual-based earnings management (ABEM). In contrast to prior research, the results show evidence not only for income-increasing but also for income-decreasing ABEM. This indicates that highly narcissistic CEOs not only strive to influence stakeholders’ perception of current performance. We conclude that they also assess their potential to influence perception of current and future earnings. The results imply that highly narcissistic CEOs’ accounting choices are driven by self-serving behavior rather than by the intention to provide additional information to the market. When earnings management techniques are used to derive personal advantage from the presentation of a firm’s earnings, the literature refers to this as a case of low earnings quality reflecting unethical behavior. Accordingly, this study contributes to the field of business ethics by showing that CEO narcissism is related to low earnings quality in that it is associated to discretionarily decreasing accruals.
TL;DR: The authors empirically examined this question on a crowd-based corporate earnings forecast platform (Estimize) and found that a large group of experts can provide an accurate answer to a question involving quantity estimation.
Abstract: When will a large group provide an accurate answer to a question involving quantity estimation? We empirically examine this question on a crowd-based corporate earnings forecast platform (Estimize....
TL;DR: In this article, a couple-level framework is proposed to examine how parenthood shapes within-family gender inequality by education in three countries that vary in their normative and policy context.
Abstract: This article advances a couple-level framework to examine how parenthood shapes within-family gender inequality by education in three countries that vary in their normative and policy context: the ...
TL;DR: In this article, the authors analyzed the dynamics of earnings forecasts and discount rates implicit in valuations during the COVID-19 crisis and found that the implicit discount rate in the stock market has been progressively reduced by 16% during the crisis.
Abstract: We analyze the dynamics of earnings forecasts and discount rates implicit in valuations during the COVID-19 crisis Forecasts over 2020 earnings have been progressively reduced by 16% Longer-run forecasts have reacted much less We estimate an implicit discount rate going from 10% in mid-February to 13% at the end of March and reverting to its initial level in mid-May Over this period, the unlevered asset risk premium is unchanged, as the risk-free rate drop is compensated by the effect of increased leverage Hence, analysts’ forecast revisions explain all of the decrease in equity values between January 2020 and mid-May 2020
TL;DR: It is found that Twitter sentiment predicts stock returns without subsequent reversals, consistent with the view that tweets provide information not already reflected in stock prices.
Abstract: This paper examines the information content of firm-specific sentiment extracted from Twitter messages. We find that Twitter sentiment predicts stock returns without subsequent reversals. This finding is consistent with the view that tweets provide information not already reflected in stock prices. We investigate possible sources of return predictability with Twitter sentiment. The results show that Twitter sentiment provides new information about analyst recommendations, analyst price targets and quarterly earnings. This information explains about one third of the predictive ability of Twitter sentiment for stock returns. Taken together, our findings shed new light on whether and why social media content has predictive value for stock returns.
University of Massachusetts Amherst1, Georgia Regents University2, University of California, Irvine3, Central European University4, Centre national de la recherche scientifique5, Vienna University of Economics and Business6, Stockholm University7, Copenhagen Business School8, University of Oslo9, Statistics Canada10, University of Illinois at Urbana–Champaign11, University of Ljubljana12, Nihon University13, University of Haifa14, Academy of Sciences of the Czech Republic15, University of Groningen16, University of Barcelona17, University of California, Berkeley18
TL;DR: The results suggest that to reduce market income inequality requires policies that raise the bargaining power of lower-skilled workers and that firm-level restructuring and increasing wage inequalities between workplaces are more central contributors to rising income inequality than previously recognized.
Abstract: It is well documented that earnings inequalities have risen in many high-income countries. Less clear are the linkages between rising income inequality and workplace dynamics, how within- and between-workplace inequality varies across countries, and to what extent these inequalities are moderated by national labor market institutions. In order to describe changes in the initial between- and within-firm market income distribution we analyze administrative records for 2,000,000,000+ job years nested within 50,000,000+ workplace years for 14 high-income countries in North America, Scandinavia, Continental and Eastern Europe, the Middle East, and East Asia. We find that countries vary a great deal in their levels and trends in earnings inequality but that the between-workplace share of wage inequality is growing in almost all countries examined and is in no country declining. We also find that earnings inequalities and the share of between-workplace inequalities are lower and grew less strongly in countries with stronger institutional employment protections and rose faster when these labor market protections weakened. Our findings suggest that firm-level restructuring and increasing wage inequalities between workplaces are more central contributors to rising income inequality than previously recognized.
TL;DR: In this paper, the authors show that dividend changes contain information about highly persistent changes in future economic income, and they use an event window approach to cleanly delineate earnings after dividend changes from those before, using alternative earnings measures to control for endogenous investment and asset write-downs surrounding dividend changes.
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TL;DR: In this article, the effects of the COVID-19 shocks in the Japanese labor market vary across people of different age groups, genders, employment types, education levels, occupations, and industries.
Abstract: Effects of the COVID-19 shocks in the Japanese labor market vary across people of different age groups, genders, employment types, education levels, occupations, and industries. We document heterogeneous changes in employment and earnings in response to the COVID-19 shocks, observed in various data sources during the initial months after onset of the pandemic in Japan. We then feed these shocks into a life-cycle model of heterogeneous agents to quantify welfare consequences of the COVID-19 shocks. In each dimension of the heterogeneity, the shocks are amplified for those who earned less prior to the crisis. Contingent workers are hit harder than regular workers, younger workers than older workers, females than males, and workers engaged in social and non-flexible jobs than those in ordinary and flexible jobs. The most severely hurt by the COVID-19 shocks has been a group of female, contingent, low-skilled workers, engaged in social and non-flexible jobs and without a spouse of a different group.
TL;DR: This paper studied how private equity buyouts create value in higher education, a sector with opaque product quality and intense government subsidy, and showed that buyouts lead to higher tuition and per-student debt.
Abstract: This paper studies how private equity buyouts create value in higher education, a sector with opaque product quality and intense government subsidy. With novel data on 88 private equity deals involving 994 schools, we show that buyouts lead to higher tuition and per-student debt. Exploiting loan limit increases, we find that private equity-owned schools better capture government aid. After buyouts, we observe lower education inputs, graduation rates, loan repayment rates, and earnings among graduates. Neither school selection nor student body changes fully explain the results. The results indicate that in a subsidized industry maximizing value may not improve consumer outcomes.
TL;DR: In this paper, the authors investigated the impact of chief executive officer (CEO) characteristics on the earnings management examined by the discretionary accruals, and found that there is a positive and significant relationship between CEO duality, CEO nationality and the quality of financial communication, but no significant relationship was found between CEO board member, CEO turnover and earnings management.
Abstract: The purpose of this paper is to investigate the impact of chief executive officer (CEO) characteristics on the earnings management examined by the discretionary accruals.,The sample includes 151 French firms listed on the CAC ALL shares index from 2006 to 2015. The paper uses the feasible generalized least square regression technique to test the relationship between CEO characteristics and earnings management.,Using discretionary accruals as a proxy for earnings management, the results obtained from the three models (Jones modified 1995; Kothari et al., 2005; Raman and Shahrur, 2008) indicated that there is a positive and significant relationship between CEO duality, CEO nationality and the quality of financial communication. However, no significant relationship was found between CEO board member, CEO turnover and earnings management.,A literature review finds that fewer studies have investigated the relationship between earnings management practices and personal CEO characteristics in the French context. Furthermore, no study yet has examined the influence of CEO nationality and CEO age on earnings management practices. This study provides empirical data about the impact of CEO’s characteristics on earnings management and how these different characteristics can facilitate the transition to manipulate and influence the quality of financial communication.
TL;DR: The authors showed that data on earnings beliefs and probabilities of choosing particular occupations can be used to predict the likelihood of choosing a particular occupation for a student, using data from Duke University undergraduates.
Abstract: Using data from Duke University undergraduates, we make three main contributions to the literature. First, we show that data on earnings beliefs and probabilities of choosing particular occupations...
TL;DR: In this article, the authors investigate whether increased investor demand for financial information arising from higher market uncertainty leads to greater media coverage of earnings announcements, and they find evidence of increased media coverage and that the greater coverage leads to improvements in investor informedness, information asymmetry, and intraperiod price timeliness, and greater trade by both retail and institutional investors.
TL;DR: The authors found that close to two-thirds of the overall gender earnings gap can be accounted for by the differential impacts of children on women and men on the career trajectories of women relative to men.
Abstract: The past five decades have seen a remarkable convergence in the economic roles of men and women in society. Yet, persistently large gender gaps in terms of labor supply, earnings, and representation in top jobs remain. Moreover, in countries like the U.S., convergence in labor market outcomes appears to have slowed in recent decades. In this article, we focus on the role of children and show that many potential explanations for the remaining gender disparities in labor market outcomes are related to the fact that children impose significantly larger penalties on the career trajectories of women relative to men. In the U.S., we document that close to two-thirds of the overall gender earnings gap can be accounted for by the differential impacts of children on women and men. We propose a simple model of household decision-making to motivate the link between children and gender gaps in the labor market, and to help rationalize how various factors potentially interact with parenthood to produce differential outcomes for men and women. We discuss several forces that might make the road to gender equity even more challenging for modern cohorts of parents, and offer a critical discussion of public policies in seeking to address the remaining gaps.
TL;DR: This article provided the first in-depth analysis of this stimulus on employment and earnings, finding that places that experience larger decreases in investment costs experienced an increase in employment and income per worker, while the policy did not have positive effects on earnings per worker.
Abstract: Since 2002, the US government has encouraged business investment using accelerated depreciation policies that significantly reduce investment costs. We provide the first in-depth analysis of this stimulus on employment and earnings. Our local labor markets approach exploits cross-industry variation in policy generosity interacted with county-level industry location data. This strategy identifies the partial equilibrium effects of accelerated depreciation. Places that experience larger decreases in investment costs see an increase in employment and earnings. In contrast, the policy does not have positive effects on earnings-per-worker. Overall, our findings suggest federal corporate tax policy has large effects on local labor markets.
TL;DR: In this paper, the authors investigated the effect of voluntary IR disclosure on analyst earnings forecast accuracy as well as on firm value and concluded that such companies might already have a relatively high level of transparency leading to an absent additional effect of IR disclosure.
Abstract: This study investigates how integrated reporting (IR) creates value for investors. It examines how providers of financial capital benefit from an improved firm information environment provided by IR. Specifically, this study investigates the effect of voluntary IR disclosure on analyst earnings forecast accuracy as well as on firm value. To do so, we use an international sample of 167 listed companies that voluntarily publish an integrated report. Our analysis shows no significant effect of a voluntary IR publication on analyst earnings forecast accuracy and no significant effect on firm value. We thus do not find evidence for the fulfillment of IR's promises regarding improved information environment and value creation of voluntary adopters. We conclude that such companies might already have a relatively high level of transparency leading to an absent additional effect of IR disclosure. Positive effects of IR appear to be more relevant in environments where IR is mandatory.