Abstract: We introduce a novel approach to learn fundamental information that investors respond to within lengthy textual disclosures. Our attention-based model is considerably more effective at explaining stock market reactions to disclosed information than attention-free models. We find that topics such as special items (losses) and debt obligations receive the highest attention among investors, whereas internal control disclosures are the least important. Building on this technology, we show that the regulatory interventions (modernization of Regulation S-K) increased investors' attention to the textual content. We also show that firms strategically position fundamental information within MD&A to influence investor focus. Overall, our findings underscore the value of attention-based analysis of corporate communications and open new avenues for future work.  

Abstract: This paper uses a large longitudinal dataset to study the predictive power of children’s time preferences on their future school outcomes, accounting simultaneously for the influences of cognitive (IQ) and noncognitive skills (the Big Five). We show that children’s time preferences significantly predict future cognitive outcomes but not behavioral outcomes when both IQ and the Big Five factors are controlled for. In terms of their respective incremental predictive power, IQ and conscientiousness are the single most important predictors of cognitive and behavioral outcomes, respectively, while time preferences only have minimal predictive power.