Market contention pressure has prompted many companies to adopt formal corporate social responsibility (CSR) policies, but can ongoing market contention pressure influence whether companies effectively implement these policies? Drawing on and extending the market contention and (de)coupling literatures, we theorize that ongoing contention in the institutional environment can prompt tighter coupling of companies’ CSR policies and practices, but can also lead companies to engage in “coupling compromises”—coupling practices more tightly with policies in the contested domain, but loosening such coupling in other CSR domains. We test our theory by investigating how global supply chain factories that have adopted CSR policies on working conditions respond to local contentious cases. Analyzing 3,495 audits of 2,352 factories in 114 Chinese cities, we find that contentious cases about wages-and-benefits issues pushes factories to couple their wages-and-benefits practices more tightly with their policies, but they concurrently loosen the coupling of policy and practice in occupational health and safety. Such coupling compromises are not, however, observed in the area of labor exploitation. Both observed effects are stronger in factories with organizational structures that foreground the salience of wages-and-benefits issues and mitigate the net cost of changing organizational practices.

We present a frictionless model which bridges two seemingly unrelated empirical anomalies: (1) the negative relationship between dispersion in financial analysts’ forecasts and expected returns (Diether et al., 2002) and (2) the negative relationship between idiosyncratic skewness and expected returns (Boyer et al., 2010; Conrad et al., 2013; Amaya et al., 2013; Boyer and Vorkink, 2014). The results follow because (1) empirically, most stocks have positive expected skewness, (2) positive skewness implies that investors’ demand schedules are convex in the relevant price range, and hence, (3) trades due to disagreement do not “cancel out"; asset prices are inflated even without short-selling constraints. Our theory further predicts that skewness and disagreement have an interactive pricing impact. We find support for this prediction in the cross section of stock returns.

This paper studies entrepreneurship and the creation of new firms through the lens of serial entrepreneurs, i.e., entrepreneurs who establish more than one firm. Drawing on data on the universe of all firms in China, we document key facts about serial entrepreneurs and how they differ from non-serial entrepreneurs. We develop a theoretical framework rationalizing how their behavior is shaped by endowments, ability, and capital market frictions. We also examine the key determinants of the sectoral choice for serial entrepreneurs’ second firms. We find that (1) persistent ability is a major driver of serial entrepreneurship; (2) financial frictions influence decisions to run firms concurrently versus sequentially; and (3) sector choice is influenced by risk diversification, input-output linkages, and learning.