Economics Insights @ CBS

This paper shows that when the bankruptcy code protects the creditors' rights with no impairments to secured creditors, issuance of debt such as repo with exemption from automatic stay adds no value. When the bankruptcy process admits violations of absolute priority rules or results in collateral impairments to secured creditors, the liability structure includes short-term debt, with safe harbor protection when the pledged collateral satisfies a minimum liquidity threshold.

The Centers for Medicare & Medicaid Services (CMS) and the National Quality Forum have endorsed the 30-day mortality rate as an important indicator of hospital quality. Concerns have been raised, however, as to whether post-discharge mortality rates are reasonable measures of hospital quality as they consider the frequency of an event that occurs after a patient is discharged and no longer under the watch and care of hospital staff. Estimating the causal effect of length-of-stay (LOS) on post-discharge mortality from retrospective data introduces a number of econometric challenges.

We decompose the returns of five well-known anomalies into cash flow and discount rate news. Common patterns emerge across the five factor portfolios and their mean variance efficient (MVE) combination. Whereas discount rate news predominates in market returns, systematic cash flow news drives the returns of anomaly portfolios and their MVE combination with the market portfolio. Anomaly cash flow and discount rate shocks are largely uncorrelated with market cash flow and discount rate shocks and with business cycle fluctuations.

Women make less than men in some science, technology, engineering, and math (STEM) fields. While explanations for this gender pay gap vary, they have tended to focus on differences that arise for women and men after they have worked for a period of time. In this study we argue that the gender pay gap begins when women and men with earned degrees enter the workforce. Further, we contend the gender pay gap may arise due to cultural beliefs about the appropriateness of women and men for STEM professions that shape individuals’ self-beliefs in the form of self-efficacy.

Salary history bans forbid employers from asking job candidates to disclose their salaries. However, applicants can still volunteer this information. Our theoretical model predicts the effect of these laws varies by how workers comply. Our survey of Americans in the labor force finds candidates fall into three compliance types: 25% always disclose their salary whether asked or not, 17% never disclose, and 58% comply with the ban (disclosing only when asked). Importantly, compliance type varies by demographics (e.g.