Geographic Peer Effects in Management

We find that the likelihood that a firm voluntarily provides an earnings forecast is sensitive to the extent to which other firms in the same geographic area provide earnings forecasts. We use instrumental variable techniques to alleviate the concern that these geographic peer effects are driven by omitted economic factors unique to a local area that lead firms to make similar disclosure decisions. Our findings imply that geographic peer effects in disclosure choices arise in part due to firms trying to avoid negative capital market effects induced by market pressure from local institutional investors. The evidence does not suggest that information sharing among firms plays a key role in generating these geographic peer effects

Firm-Manager Matching and the Tradeoffs of CFO Accounting Expertise

We examine the tradeoffs of CFO accounting expertise and their role in firm-manager matching decisions. Although prior work examines the positive effects of accounting expertise on several financial reporting outcomes, there is little evidence on the tradeoffs this expertise entails, much less how firms compensate for these tradeoffs. We conjecture that acquiring accounting expertise requires costly tradeoffs in terms of acquiring other skills, including operational knowledge and strategic expertise. We find that these tradeoffs are reflected in firms’ hiring decisions ex ante and affect several ex post employment decisions. Collectively, the results suggest accounting expertise is a carefully weighed attribute of CFO hires that shapes and is shaped by the composition of the top management team

Open Versus Closed Conference Calls: The Determinants and Effects of Broadening Access to Disclosure

Recent advances in information technology allow firms to provide broader access to their disclosures. We examine the determinants and effects of the decision to provide unlimited real-time access to conference calls (i.e., “open” conference calls). Our evidence suggests that the decision to provide open calls is associated with the composition of a firm\u27s investor base and, to some degree, the complexity of its financial information. We also find that open calls are associated with a greater increase in small trades (consistent with individuals trading on information released during the call) and higher price volatility during the call period

An Accessory to the ‘Trinity’: SR-As Are Essential Pathogen Sensors of Extracellular dsRNA, Mediating Entry and Leading to Subsequent Type I IFN Responses

Extracellular RNA is becoming increasingly recognized as a signaling molecule. Virally derived double stranded (ds)RNA released into the extracellular space during virus induced cell lysis acts as a powerful inducer of classical type I interferon (IFN) responses; however, the receptor that mediates this response has not been identified. Class A scavenger receptors (SR-As) are likely candidates due to their cell surface expression and ability to bind nucleic acids. In this study, we investigated a possible role for SR-As in mediating type I IFN responses induced by extracellular dsRNA in fibroblasts, a predominant producer of IFNβ. Fibroblasts were found to express functional SR-As, even SR-A species thought to be macrophage specific. SR-A specific competitive ligands significantly blocked extracellular dsRNA binding, entry and subsequent interferon stimulated gene (ISG) induction. Candidate SR-As were systematically investigated using RNAi and the most dramatic inhibition in responses was observed when all candidate SR-As were knocked down in unison. Partial inhibition of dsRNA induced antiviral responses was observed in vivo in SR-AI/II-/- mice compared with WT controls. The role of SR-As in mediating extracellular dsRNA entry and subsequent induced antiviral responses was observed in both murine and human fibroblasts. SR-As appear to function as ‘carriers’, facilitating dsRNA entry and delivery to the established dsRNA sensing receptors, specifically TLR3, RIGI and MDA-5. Identifying SR-As as gatekeepers of the cell, mediating innate antiviral responses, represents a novel function for this receptor family and provides insight into how cells recognize danger signals associated with lytic virus infections. Furthermore, the implications of a cell surface receptor capable of recognizing extracellular RNA may exceed beyond viral immunity to mediating other important innate immune functions

Stem Cell Therapy: Pieces of the Puzzle

Acute ischemic injury and chronic cardiomyopathies can cause irreversible loss of cardiac tissue leading to heart failure. Cellular therapy offers a new paradigm for treatment of heart disease. Stem cell therapies in animal models show that transplantation of various cell preparations improves ventricular function after injury. The first clinical trials in patients produced some encouraging results, despite limited evidence for the long-term survival of transplanted cells. Ongoing research at the bench and the bedside aims to compare sources of donor cells, test methods of cell delivery, improve myocardial homing, bolster cell survival, and promote cardiomyocyte differentiation. This article reviews progress toward these goals

Do Analysts Cater to Investor Beliefs? Evidence from Dual-Listed Chinese Firms

We take advantage of a unique setting in China to provide novel evidence on a catering theory for analyst optimism. Our study utilizes the Stock Connect programs that allowed foreign investors to invest in Chinese stocks as an exogenous shock to investor beliefs. We further focus our study on a subset of Chinese firms with both "A shares" (listed in mainland China) and "H shares" (listed in Hong Kong) to provide a clean test of our hypotheses. We find that A share analysts become less optimistic in their recommendations following the introduction of less optimistic investors through the Stock Connect programs. In addition, catering theory predicts that when investors hold heterogeneous beliefs, analysts tend to segment the market and slant toward extreme positions in order to attract target investors. Consistent with this prediction, we find that A share analysts with buy or strong buy (sell or underperform) recommendations of a given firm become more optimistic (pessimistic) in their forecasts and research report tone after the Stock Connect programs. Finally, we show that in updating their earnings forecasts, analysts are more (less) responsive to earnings surprises that are consistent (inconsistent) with their stock recommendations. Overall, the results suggest that analysts cater to investors' opinions