Research

Published and forthcoming papers:

1. “Informed Voting,” with Meng Gao, March 2024, Accepted for publication at the Review of Financial Studies. [SSRN]
   We propose a stock-return based measure, vote alpha, to capture informed voting by mutual funds. We show that the voting pattern of high vote alpha funds predicts abnormal stock returns following contentious votes.

2. “Thy Neighbor’s Vote: Peer Effects in Proxy Voting,” 2023, Management Science 69, 4169–4189. [SSRN] [Publisher]
   Shocks to the voting behavior of one shareholder can transmit to nearby shareholders, leading to large aggregate effects on governance outcomes.

3. “Give Me Your Tired, Your Poor, Your High-skilled Labor: H-1B Lottery Outcomes and Entrepreneurial Success,” with Stephen Dimmock and Scott Weisbenner, 2022, Management Science 68, 6355–7064. [NBER Working Paper No. 26392] [SSRN] [Publisher]
   - Featured in the Economist, NBER Digest, Economic Times, Quartz, and Bloomberg Opinion.
   Startups with a higher win rate in H-1B visa lotteries have more successful funding and innovation outcomes than otherwise similar firms.

4. “Dynamic Liquidity Preferences of Mutual Funds,” 2020, Quarterly Journal of Finance 10, 2050018. [SSRN] [Publisher]
   Mutual fund managers tilt their portfolios more heavily towards liquid assets during times when expected market volatility is high. Such dynamic behavior leads to superior fund returns. 

5. “All the President’s Friends: Political Access and Firm Value,” with Jeffrey Brown, 2020, Journal of Financial Economics 138, 415–431. [NBER] [Publisher] [Internet Appendix]
   - Featured in The Economist, Wall Street Journal, Financial Times, NPR, Politico, Fortune, CNBC, Washington Examiner, The New Yorker, Harvard Business Review, and Bloomberg (1, 2).
   - WRDS Award for Best Paper on Empirical Finance at the 2018 WFA.
   Corporate executives’ meetings with key policymakers are associated with positive abnormal stock returns and are followed by more government contracts and higher likelihood of receiving regulatory relief.

6. “Informing the Market: The Effect of Modern Information Technologies on Information Production,” with Meng Gao, 2020, Review of Financial Studies 33, 1367–1411 [Editor’s Choice, lead article].  [SSRN] [Publisher] [Internet Appendix]
   - The phase-in schedule can be found in Appendix B of SEC Release No. 33-6977.
   The staggered implementation of the EDGAR system leads to increased information production by individual investors and sell-side financial analysts.

7. “Pollution and Performance: Do Investors Make Worse Trades on Hazy Days?” with Nianhang Xu and Honghai Yu, 2020, Management Science 66, 4455–4476. [SSRN] [Publisher] [Internet Appendix]
   Air pollution negatively affects trade performance due to exacerbated investment biases such as the disposition effect and attention-driven purchase behavior.

8. “Internalizing Governance Externalities: The Role of Institutional Cross-ownership,” with Jie (Jack) He and Shan Zhao, 2019, Journal of Financial Economics 134, 400–418. [SSRN] [Publisher]
   - Featured in Columbia Law School Blue Sky Blog and Bloomberg View by Matt Levin.
   An institution’s holdings in the peers of a focal firm increase the likelihood that the institution votes against management in shareholder-sponsored governance proposals at the focal firm.

9. “The Customer Knows Best: The Investment Value of Consumer Opinions,” 2018, Journal of Financial Economics 128, 164–182. [SSRN] [Publisher] [Internet Appendix]
   - Featured in the Wall Street Journal, Oxford Business Law Blog, and HFM Week.
   Abnormal customer ratings positively predict subsequent stock returns as well as revenues and earnings surprises.

10. “Product Market Competition in a World of Cross-ownership: Evidence from Institutional Blockholdings,” with Jie (Jack) He, 2017, Review of Financial Studies 30, 2674–2718. [SSRN] [Publisher]
    Cross-ownership by institutional blockholders improves firms’ product market performance by fostering product market coordination.

11. “Capitalizing on Capitol Hill: Informed Trading by Hedge Fund Managers,” with Meng Gao, 2016, Journal of Financial Economics 121, 521–545. [SSRN] [Publisher] [Internet Appendix]
    - Featured in Bloomberge News, Dow Jones MarketWatch, Washington Times, and Les Echos.
    Hedge funds connected to lobbyists tend to trade more heavily in politically sensitive stocks, and they perform significantly better on politically sensitive positions than non-political positions.

12. “Institutional Investors and the Information Production Theory of Stock Splits,” with Thomas Chemmanur and Gang Hu, 2015, Journal of Financial and Quantitative Analysis 50, 413–445. [SSRN] [Publisher]
    Stock splits are followed by an increase in institutional brokerage commissions, an increase in information production by brokerage houses, and an increase in the trade informativeness of institutional investors.

13. “Gender and Corporate Finance: Are Male Executives Overconfident Relative to Female Executives?” with Darren Kisgen, 2013, Journal of Financial Economics 108, 822–839. [SSRN] [Publisher]
    Male executives make more acquisitions and issue more debt than female executives, but male executives’ corporate decisions are associated with lower announcement returns.

14. “The Role of Institutional Investors in Initial Public Offerings,” with Thomas Chemmanur and Gang Hu, 2010, Review of Financial Studies 23, 4496–4540. [SSRN] [Publisher]
    Institutional investors appear to possess an informational advantage over retail investors in IPOs.

Working papers:

1. “Corporate Capture of Congress in Carbon Politics: Evidence from Roll Call Votes,” with Meng Gao, August 2023. [SSRN]
   - Presented at the 2024 AEA.
   We show that lawmakers with high carbon dependency, i.e., those whose campaigns received more contributions from carbon-emitting firms, are more likely to cast climate-skeptic votes. We use the narrow defeat of incumbent politicians to generate plausibly exogenous shocks to their elected peers’ carbon dependency to identify the effect.

2. “Geographic Concentration of Institutional Investors and the Market for Corporate Control,” March 2019. [SSRN]
   - Presented at the 2012 WFA (Las Vegas), the 2011 FIRS conference (Sydney, Australia), the 2011 China International Conference in Finance (CICF), and the CGIO Academic Conference (Singapore).
   Geographic concentration promotes coordination among institutional shareholders and enhances their monitoring role in corporate control transactions.

3. “Shareholder Coordination, Corporate Governance, and Firm Value,” October 2015. [SSRN]
   - Presented at the 2012 Rothschild Caesarea Center Annual Academic Conference (Herzliya, Israel) and the 2012 Financial Intermediation Research Society (FIRS) Annual Conference (Minneapolis), and the 2012 EFA (Copenhagen).
   The ease of coordination among institutional shareholders is positively associated with firm value.