When Policy Meets Preference: The Economic Impact of Employer Vaccine Mandate Bans, with Mike Cooper, Tim Liu, and Yihui Pan
Selected Presentations: Chinese University of Hong Kong, George Mason University, Georgetown University, Hong Kong University, Hong Kong University of Science and Technology, Northeastern University, Peking University (PHBS), University of New South Wales, University of Sydney, University of Technology Sydney, Virginia Tech, University of Utah, Wasatch Finance Conference 2023, FMA 2023, MFA 2024, CICF 2024, AFA 2025 ACES Political Economy Panel Session
Abstract: We use the staggered introduction of state-level bans on employer COVID vaccine mandates as an exogenous constraint on HR policies to study how preference (mis)alignment—between em-ployees, managers, and the policy environment—affects firm value and labor outcomes. We find significant and positive market reactions in firms with a Republican workforce, especially those facing tight labor markets or having Democratic leadership, while firms with a Democratic workforce see mildly negative reactions. Following ban passage, impacted establishments expe-rience greater employment growth compared to unaffected ones, particularly in firms with a Republican workforce. Improved labor market outcomes translate into higher profitability.
Carbon Emissions Under Policy Transition Uncertainty
Presented at: University of Utah, FMA 2025, Asia/Pacific Conference 2025
This paper investigates the impact of environmental policy uncertainty, which is elevated during policymaker transitions, on corporate carbon emissions. By exploiting a quasi-natural experiment involving policymakers’ unexpected deaths and resignations, I show that policy uncertainty leads to a reduction in carbon emissions. This emission reduction cannot be explained by established channels in the previous literature, namely regime shifts and financial constraints. Instead, political connections, evidenced through executives’ donations to policymakers, primarily drive this emission reduction. Notably, even following the replacement of a policymaker with similar environmental policies, firms continue to reduce emissions after losing political connections. These findings suggest that political connections offer a “permit” for firms to pollute more.
How Does the Stock Market Value Workplace Gender Equality? Evidence from #MeToo Laws, with Yawen Jiao
Selected Presentations: Chinese University of Hong Kong, Shenzhen, Kobe University, and University of Utah, FMA 2024
Abstract: The #MeToo movement has brought to light the issue of workplace harassment and misconduct, leading to the reform of workplace anti-harassment laws in many U.S. states. We document a strong and positive equity market reaction to the passage of #MeToo bills that reverses within 90 days. Firms with higher sexual harassment rates, employing more women, having more female directors, or are located in more Democratic-leaning areas experience less positive market reactions. Operating performance and employee productivity decline after the passage of the law. Firms also hire fewer young women and more young men. Our findings suggest that investors misestimate the costs imposed on firms by gender equality legislation and its impact on firms’ operations.
Stock Splits are Not Dead: Implications of Reappearing Stock Splits , with Peter Chung and Liu Yun (under review)
Presented at: University of Utah, FMA 2024
Abstract: We document that stock splits have not disappeared but are recently reappearing. This paper posits that firms in recent years, in particular, have been splitting their stocks to attract attention from investors and customers. We show that stock liquidity significantly goes up while the firm’s sales grow significantly after the stock split. Interestingly, smaller and less institutionally-owned firms benefit more from the positive liquidity effect and sales growth effect while large and more institutionally-owned firms attract more retail investors’ trading. Such heterogeneous effects of stock splits are more pronounced for more recent samples. Finally, the abnormal stock return around the announcement and during the quarters after the split are significantly positive, but more positive for smaller and less institutionally-owned firms.
The Real Effects of Anti-ESG Laws (with Mike Cooper, Jixing Li, and Bharat Parajuli)
Financial Advisor and Initial Public Offerings (with Peter Chung and Shana Hong)
Does Innovation Affect Stock Migration (with Mike Cooper, Pengfei Sui, and Wenhao Yang)
On Exploitative Homophily in Venture Capital Markets (with Hyun Joong Kim and Hisan Yang)