Diversified acquirer shareholders can profit from value-destroying acquisitions not only through their target stakes, but also through stakes in non-merging rival firms. Announcement losses are largely mitigated for the average acquirer shareholder when accounting for wealth effects on their rival stakes. Ownership by acquirer shareholders in non-merging rivals is negatively associated with deal quality and positively associated with deal completion. Funds with more rival ownership are more likely to vote in favor of the acquisition. Overall, these results show that many so-called "bad deals" are often in the interest of acquirer-firm shareholders.

This paper studies the empirical relationship between common ownership and interlocking directorships. I estimate a gravity equation model for the probability that a pair of firms will have a common director, as a function of the geographic distance between the firms, their sizes, and a set of covariates, including measures of common ownership between the firms. The main finding is that, robustly across several measures of common ownership, firm pairs with higher levels of common ownership are associated with a higher likelihood of sharing directors. Also, their distance in the network of directors is smaller on average. Consistent with the "gravity" interpretation, larger firms are more likely to share directors, and firms that are geographically more distant are less likely to share directors.

We study how the MillerCoors joint venture affected craft brewers in the United States. We use scanner data to track the entry, assortment, and market share of artisanal and com-mercial brewers over a 4-year period after the merger. Using an instrumental variables strategy that uses only variation in concentration generated by the merger, we find that, in the average market, the merger led to an 11.59% increase in the number of craft brew-ers. The number of products per craft brewer did not increase. Most of the new entrants were small, and thus the market share of craft brewers experienced only a small (though statistically significant) increase. This entry of new firms may have been facilitated by the increase in prices by incumbent commercial producers following the merger. (c) 2022 Elsevier B.V. All rights reserved.

A product market is concentrated when a few firms dominate the market. Similarly, a labor market is concentrated when a few firms dominate hiring in the market. Using data from the leading employment website CareerBuildercom, we calculate labor market concentration for more than 8,000 geographic-occupational labor markets in the United States. Based on the Department of Justice-Federal Trade Commission horizontal merger guidelines, the average market is highly concentrated. Going from the 25th percentile to the 75th percentile in concentration is associated with a 5 percent (OLS) to 17 percent (IV) decline in posted wages, suggesting that concentration increases labor market power.

We document substantial time-series and cross-sectional variation in branch-level deposit account interest rates, maintenance fees, and fee thresholds, and examine whether variation in bank concentration helps explain variation in these prices. Herfindahl-Hirschman Index (HHI) alone is not correlated with any of the outcome variables. A generalized HHI (GHHI) capturing both common ownership (the degree to which banks are commonly owned by the same investors) and cross-ownership (the extent to which banks own shares in each other), is strongly correlated with all prices, even when we limit cross-sectional variation in bank ownership to only that predicted by the growth of index funds.

We develop a tractable general equilibrium framework in which firms are large and have market power with respect to both products and labor, and in which a firm's decisions are affected by its ownership structure. We characterize the Cournot-Walras equilibrium of an economy where each firm maximizes a share-weighted average of shareholder utilities-rendering the equilibrium independent of price normalization. In a one-sector economy, if returns to scale are non-increasing, then an increase in effective market concentration (which accounts for common ownership) leads to declines in employment, real wages, and the labor share. Yet when there are multiple sectors, due to an intersectoral pecuniary externality, an increase in common ownership could stimulate the economy when the elasticity of labor supply is high relative to the elasticity of substitution in product markets. We characterize for which ownership structures the monopolistically competitive limit or an oligopolistic one is attained as the number of sectors in the economy increases. When firms have heterogeneous constant returns to scale technologies, we find that an increase in common ownership leads to markets that are more concentrated.

This article argues that the evidence presented in several critiques of Azar, Schmalz, and Tecu¿s (AST) ¿airlines¿ paper does often not back the conclusion these studies draw. Specifically, widely circulated studies claiming that there are no anticompetitive effects of common ownership or that there is no evidence of it either do not attempt to refute AST¿s findings of anticompetitive effects in the U.S. airlines industry or in fact confirm the evidence by AST and even dispel valid concerns about AST¿s methodology. Focusing on Kennedy, O¿Brien, Song, and Waehrer (KOSW), we note that their panel regressions using market-share-free indices of common ownership concentration confirm the positive correlation between common ownership concentration and price, which AST showed with a measure containing potentially endogenous market shares. We then examine the alternative empirical methods KOSW propose: (i) Their conclusion that estimates from a structural model show no evidence of anticompetitive effects is based on an estimation that discards 90% of the available data and therefore, at best, is only valid for that subsample; (ii) their structural model makes no economic sense because it produces a negative effect of route distance on marginal cost; and (iii) they construct an alternative version of the widely used BlackRock- Barclays Global Investors instrument that is arguably invalid. Even absent these methodological concerns, KOSW¿s structural estimates are so noisy that they do not in fact reject the hypothesis that common ownership concentration has a positive effect on prices. A more recent structural paper by Park and Seo has shown these concerns to be well-founded: using a different and larger subsample of AST¿s data and more standard estimation methods compared to KOSW, they estimate a positive effect of common ownership on prices, as well as a positive effect of route distance on cost. A lesson for future research¿and readers of the literature¿is to critically evaluate the conclusions drawn by studies in this field, including those that advertise themselves as providing evidence against the existence of anticompetitive effects of common ownership.

This paper examines the role of the "Big Three" (i.e., BlackRock, Vanguard, and State Street Global Advisors) on the reduction of corporate carbon emissions around the world. Using novel data on engagements of the Big Three with individual firms, we find evidence that the Big Three focus their engagement effort on large firms with high CO2 emissions in which these investors hold a significant stake. Consistent with this engagement influence being effective, we observe a strong and robust negative association between Big Three ownership and subsequent carbon emissions among MSCI index constituents, a pattern that becomes stronger in the later years of the sample period as the three institutions publicly commit to tackle Environmental, Social, and Governance (ESG) issues. (c) 2021 Elsevier B.V. All rights reserved.

Using detailed data on skill requirements in online vacancies, we estimate the demand for AI specialists across occupations, sectors, and firms. We document a dramatic increase in the demand for AI skills over 2010-2019 in the U.S. economy across most industries and occupations. The demand is highest in IT occupations, followed by architecture and engineering, scientific, and management occupations. Firms with larger market capitalization, higher cash holdings, and higher investments in R&D have a higher demand for AI skills. We also document a wage premium of 11% for job postings that require AI skills within the same firm and 5% within the same job title. Managerial occupations have the highest wage premium for AI skills. Firms demanding AI skills more intensively also offer higher salaries in non-AI jobs.