Using labor skill demand disclosed in job postings as a proxy for firms' growth strategies, we find that similar growth strategies increase the likelihood of two firms merging. In particular, a firm is more likely to become a target as its labor skill demand becomes more similar to that of its potential acquirer. Similar growth strategies ameliorate post-merger integration challenges in facilitating merger deals. Following the merger, the combined firm continues hiring the same skills, consistent with the growth strategy persisting. These types of mergers experience more synergies and superior operating performance.

Should households buy their homes? Contrary to popular expert advice, our block-bootstrap life-cycle simulation provides an affirmative answer. Homeownership generates wealth and welfare gains relative to rent-for-life benchmarks that invest only in financial assets. It lowers household portfolio downside risk and improves retirement consumption and bequest outcomes. The gains reflect risk aversion, intertemporal substitution, leverage-induced trade-offs between consumption and the timing of home purchases, and the liquidity costs of homeownership. Their magnitude varies across labor income profiles, house price environments, and mortgage rates. Our findings suggest that homeownership can build wealth more effectively than common portfolio strategies, including all-equity portfolios.

Using nonpublic U.S. Securities and Exchange Commission (SEC) investigations data obtained via the Freedom Information Act (FOIA), we examine whether the SEC incorporates short-selling signals when deciding which firms to investigate. We find that firms with higher abnormal short interest are more likely to be investigated. This relation is concentrated at the investigation stage: abnormal short interest predicts which firms are investigated, but not whether those investigations lead to formal enforcement. We further show that the SEC's reliance on short sellers is stronger under capacity constraints and when firm information is more opaque, and it is driven by signals related to potential misconduct rather than valuation.

We show that the SEC is less likely to open an investigation when a company has a larger percentage of female directors. For example, companies with at least 35% women directors are 26% less likely to be investigated. To establish causality, we demonstrate that when board gender diversity increased for exogenous reasons, such as following the Big Three campaign to add female directors, firms with a higher percentage of women were subsequently less likely to be targeted by the SEC. The effect of female board representation on reducing SEC investigations is particularly strong when SEC leadership conveys gender equality values. Companies that are targeted by an SEC investigation respond by appointing more women to their boards, indicating that firms view female directors as beneficial in times of crisis and when supervisory skills are needed.

Using hand-collected data on founder CEOs and SEC investigations obtained through Freedom of Information Act requests, we find that firms led by founder-CEO are 29% more likely to face SEC investigations, though these investigations rarely lead to accounting or auditing enforcement release actions. CEO attributes—power, risk-taking, and visibility—drive this heightened attention, consistent with the SEC's broad strategy that seeks to hold individuals accountable. Investors of founder-led firms appear compensated for the increased investigation risk through superior stock performance. Overall, our findings on the regulatory consequences of founder CEOs provide direct evidence of SEC's strategic emphasis on individual accountability.

Classification outperforms regression across matched machine learning models in portfolio construction. A stacking ensemble of gradient boosted tree, random forest, and neural network yields a value-weighted annualized Sharpe ratio of 1.83 for classification and 1.11 for regression. This outperformance persists in multiclass settings, across subsamples, and after transaction costs. Spanning tests show that classification retains economically large alphas after we control for regression, whereas regression alphas shrink substantially once we control for classification. These results indicate that classification extracts more return information than matched regression. Our diagnostics trace classification’s advantage to sharper and more precise separation of return deciles.

Campbell and Shiller (1988b, a) show that $d_t - p_t \approx \text{const.} + \mathbb{E}\left[\sum_{j=1}^{\infty}\rho_{j-1}(r_{t+j}-\Delta d_{t+j})\right]$. Therefore, if payout growth is not predictable, the payout-price ratio decides returns and the returns must be predictable. Using 150-year data from 16 developed countries across bond, equity, and housing markets, I study this implication using the payout-price ratios, i.e., coupon price, dividend price, and rent price. None of the 48 country-asset combinations shows consistent in-sample and out-of-sample performance with positive utility gain for the mean-variance investor. However, 14 (5) countries have predictable payout growth in the equity (housing) markets. Cochrane (2008, 2011, 2020) argues that the dividend predictability and the return predictability form a joint hypothesis, and the denial of time series predictability does not hold if we reject the hypothesis that the dividend growth is predictable. Contrary to Cochrane's finding, the VAR simulation using data from all the countries in the past 150 years does not reject the null that the dividend growth is predictable and thus the joint hypothesis test provides weak support to return predictability.

We construct firm-level social network using partnership relations. Systematically important firms, i.e., firms that are highly connected and of greater centrality, face more SEC scrutiny across different enforcement actions, including AAER actions and SEC investigations. Our findings remain robust when applying stacked difference-in-differences (DiD) analyses that leverage exogenous firm-level reductions in network sizes within the corresponding Louvain communities, driven by mergers and acquisitions. They also hold under stacked DiD specifications using the introduction of combined tax reporting as an exogenous shock to the number of firm partnerships (Bodnaruk, 2013).