Learnings From 1,000 Rejections

The Review of Finance aimed to significantly increase its standards over my 6 years as Managing Editor and 1 year as Editor. To comply with these new standards, I had to reject nearly 1,000 manuscripts. This article aims to use these rejections constructively by distilling common reasons for rejection to guide future research. They are divided into three categories: contribution, execution, and exposition. Beyond extracts from decision letters that give reasons for rejection, this article also shares excerpts that shed light on the editorial process, such as how an editor weighs up feedback to reach a decision, as well as emails to authors outside formal letters in response to queries on the process

Expected Losses, Unexpected Costs? Evidence from SME Credit Access under IFRS 9

This paper examines lending effects of European banks switching to an expected credit loss (ECL) model under IFRS 9. I find evidence that ECL transition deteriorates the credit landscape for SMEs—as risky, opaque, and bank-dependent borrowers. Post-ECL, affected banks reduced SME lending by over 10 percent, and these effects persisted during the most recent downturn during the COVID-19 pandemic. Banks’ financial reporting objectives and implementation difficulties seem to explain these findings. Additional tests at the borrower and loan-contract levels indicate rising loan rejection rates, interest spreads, and collateral requirements, as well as declining loan amounts, maturities, and subsequent capital investments, for SMEs that do business with affected banks

Measuring Investor Attention Using Google Search

Although investor attention is fundamental to the efficient functioning of capital markets, it is also an elusive construct that researchers struggle to measure. In recent years, the search volume index (SVI) of ticker searches on Google has become a ubiquitous measure of investor attention, but the amount and effects of measurement error in ticker SVI are unknown. We investigate measurement error in ticker SVI using a data set of 2.7 billion website visits following Standard and Poor’s 500 firms’ ticker searches. We find that 69% of searches are unrelated to investing, that this measurement error is highly correlated with firm characteristics, and that this measurement error can easily generate false-positive or false-negative results in common settings. We go on to show that a modified version of SVI using both a firm’s ticker and the word “stock” (e.g., searches for “CAT stock,” which we label “ticker-stock SVI”) not only better captures the search terms that investors typically use, but also has considerably less measurement error that is largely uncorrelated with observable firm characteristics. Ticker-stock SVI produces better specified tests, and although researchers must still carefully consider the effects of measurement error, we recommend that ticker-stock SVI is used in place of ticker SVI in most settings. We provide a data set of ticker-stock SVI to facilitate future work

The Misfit Bias

Consumers and other audiences often penalize products that combine unrelated elements. In this paper, we document the consequences of that penalty for the evaluation of the elements being combined. Building on the idea that audiences cannot fully disentangle the quality of “fit” between elements from the quality of the elements individually, we argue that audiences are likely to direct their dislike of a misfit product to the individual elements being combined. Using an archival study of the music industry and an online experiment with photographic galleries, we find that evaluations of individual elements (songs, photographs) are influenced by product-level fit (albums, galleries). Elements of misfit products are evaluated less favorably than they would have been otherwise. Moreover, this bias is exacerbated when the evaluation of the whole product is emphasized. We discuss the implications of this “misfit bias” for the innovation, entrepreneurship, and categories literatures

Physical Climate Change Exposure and Firms’ Adaptation Strategy

Research Summary: This paper examines whether and how firms adapt to physical exposures to climate change. I build a novel dataset that compiles information on the adaptation strategies of publicly traded companies around the globe and merge it with climate science data. I find that firms are sensitive to the nature and level of forecasted climate change exposures, and that they adapt more often and more completely to those most salient to their business. Increased physical climate exposure heightens the perceived impact of climate change, leading to a higher degree of adaptation. Furthermore, the positive relationship between firms’ climate change exposure and their adaptation is stronger for firms with greater environmental, social, and corporate governance capabilities and those with longer time horizons. Managerial Summary: Companies are increasingly exposed to the physical impacts of climate change, yet little is known about how they adapt to these long-term, systemic, and uncertain changes. This study investigates corporate adaptation strategies in response to climate change. By analyzing climate science data and climate change disclosure information from publicly traded companies worldwide, I find that most firms do not adapt to different physical climate change exposures. They adapt more often and more completely when facing higher forecasted climate exposures. Furthermore, firms’ environmental, social, and corporate governance capabilities and their time horizons influence their adaptation to greater climate exposures. These findings suggest that targeted interventions may be necessary to improve corporate adaptation to climate change

TRIPS and knowledge diffusion from low‐ and middle‐income countries

Research Summary: We examine a significant yet underappreciated effect of IPR implementation: the dissemination after TRIPS implementation of established scientific knowledge from low‐ and middle‐income countries (LMICs) into the global scientific system of pharmaceutical development. The staggered implementation of the policy allows identification of increased diffusion of pre‐existing LMIC knowledge on global diseases into the global corporate invention pipeline. For neglected diseases, the uptake remains in academic science. Other results demonstrate institutional effects in the scientific communities in LMICs through increases in scientific productivity, cross‐border collaborations, and scientist mobility. These and other results recast TRIPS’ impact as sensitive to the incentives of global corporations and institutionally significant for LMICs. We discuss implications for research on innovation strategy. Managerial Summary: The implementation in an LMIC of an intellectual‐property system (e.g., of patents) carries implications for dissemination of pre‐existing scientific knowledge from the implementing country into the global scientific system. Corporate invention more intensively incorporates pre‐existing LMIC knowledge when the subject is global diseases such as cardiovascular conditions and cancer. However, when the subject is neglected diseases such as infectious conditions, the significant uptake remains in academic science. Overall, this research suggests that the implementation of patent and other intellectual‐property protections influences the integration of LMIC science into the global system differentially based on the relevance for global commercialization

Commentary on King, A. A. (2025). “Do sustainable companies have better financial performance? Revisiting a seminal study.”

We are writing this short commentary to clarify the matching process we implemented in Eccles, Ioannou and Serafeim (EIS 2014), which King (2025) analyzed in his recent publication in JOMSR

Mapping Entrepreneurial Inclusion Across US Neighborhoods: The Case of Low-Code E-commerce Entrepreneurship

Entrepreneurship is presented as a path to prosper through commerce, yet there is evidence that certain communities are underrepresented in entrepreneurship. Technological developments such as low-code e-commerce tools have altered the barriers to launch commercial ventures. Do these tools alter entrepreneurial inclusion? We study an omnipresent low-code tool, Shopify, which has dramatically reduced the financial and technical barriers to e- commerce. We undertake an abductive analysis using unique data on the spatial distribution of Shopify-based activity for the entire US. We find evidence of entrepreneurial inclusion; neighborhoods with more Black residents, a group historically underrepresented in entrepreneurship, also have more low-code ventures. We interpret these results against traditional forms of startups: newly registered businesses and VC-backed e-commerce ventures. These benchmark analyses further support our findings

Monetary and financial policies

The Washington Consensus helped forge a world view in which opening borders to capital flows was seen as an important way to increase economic efficiency. In the past decades, evidence accumulated of the shortcomings of a largely unmanaged financial system in which the volatility of capital flows was still seen as an exogenous feature of the world economy. This chapter sets the stage by discussing the characteristics of the global financial cycle (GFC) and the role of the United States Federal Reserve, to then discuss the influence of this cycle on the pass-through of domestic monetary policy to market rates for emerging markets (EMs) and advanced economies. It then sets out the implications of limited monetary policy pass-through for the validity of the trilemma in international finance. The chapter calls for the systematic use of macroprudential policy tools in advanced and EMs alike to complement credible monetary policy frameworks. It also emphasises the importance of the development of local currency bond markets. In some cases, capital controls may also be useful

When mimicry leads to divergence: Interdependence asymmetries and selective imitation among competitors

Research Summary We investigate why firms imitating the same competitor's strategy in the same environment often replicate different components of that strategy. We argue that such divergence can arise because firms vary in the internal interdependencies that underlie their strategies. When a firm significantly differs from a competitor in how one component of its strategy interacts with other components, the consequences of replicating the competitor's choices about that component are harder to anticipate, making imitation less likely. We discuss how imitators' internal coordination mechanisms may help mitigate barriers to imitation arising from interdependence asymmetries and test our resulting hypotheses in the context of esports, where small teams of professional video-game players compete in high-stakes tournaments. Managerial Summary We investigate why firms observing the same competitor often imitate different aspects of that competitor’s strategy. We argue that this variation stems from each firm’s unique internal connections between activities. When a competitor’s practice is closely linked to other parts of their strategy, imitation becomes riskier if similar links do not exist in the focal firm—making imitation less likely. Using data from esports teams, where both strategic choices and coordination are observable, we show that these differences can act as barriers to imitation. However, strong communication or shared experience among decision-makers helps overcome such barriers. Our results may caution managers against indiscriminately copying “best practices”: the highly competitive teams we studied considered not only what competitors did, but also whether those practices fit their own processes and structures