We argue that a taken-for-granted category gives way to a new category when strategic behavior becomes stigmatized. As a result, even bystander firms that have engaged in similar strategic behavior, such as lobbying, will be penalized by their association with the culpable strategic behavior. The extent of their association with the culpable behavior will determine the level of punishment they receive. However, if a trustworthy third party administers a corrective measure, the affected firms can regain their lost legitimacy. The extent of their restoration is proportional to the amount of legitimacy that was lost. We provide empirical evidence for this argument by analyzing the Jack Abramoff case, one of the most notorious corrupt lobbying cases in US history. We find that bystander firms were penalized by shareholders when the corrupt lobbying was revealed. Furthermore, the penalty was more severe for bystander firms that engaged in more lobbying activities and hired more revolving-door lobbyists. We also find that the subsequent legal remedy helped the bystander firms that were penalized the most to recover the most from their losses. We confirm the theoretical notion using the Enron case as well.

We document and explain the sharp performance deterioration of smart beta indexes after the corresponding exchange-traded funds (ETFs) are launched for investment. While smart beta is purported to deliver excess returns through factor exposures, the market-adjusted return of smart beta indexes drops from about 3% “on paper” before ETF listings to about −0.50% to −1% after ETF listings. This performance decline cannot be explained by variation in factor premia, strategic timing, or diminishing returns to scale. Instead, we find strong evidence of data mining in the construction of smart beta indexes, which helps ETFs attract flows, as investors respond positively to backtests.

We find that mortgage loans originated after the adoption of the inevitable disclosure doctrine (IDD; a mechanism discouraging loan officers’ labor mobility) have a lower default probability, a higher loan modification rate, and a lower foreclosure rate. These effects are unaccompanied by any reduction in loan supply and contribute to more stable housing prices. Using the adoption of the Uniform Trade Secrets Act as an alternative identification generates consistent results. Overall, our findings suggest that restricting loan officers’ labor mobility leads to better ex ante screening and ex post monitoring, improving the origination efficiency for U.S. residential mortgage loans.

Despite becoming increasingly represented in academic departments, women scholars face a critical lack of support as they navigate demands pertaining to pregnancy, motherhood, and child caregiving. In addition, cultural norms surrounding how faculty and academic leaders discuss and talk about tenure, promotion, and career success have created pressure for women who wish to grow their family and care for their children, leading to questions about whether it is possible for these women to have a family and an academic career. This paper is a call to action for academia to build structures that support professors who are women as they navigate the complexities of pregnancy, the postpartum period, and the caregiving demands of their children. We specifically call on those of us in I-O psychology, management, and related departments to lead the way. In making this call, we first present the realistic, moral, and financial cases for why this issue needs to be at the forefront of discussions surrounding success in the academy. We then discuss how, in the U.S. and elsewhere, an absence of policies supporting women places two groups of academics—department heads (as the leaders of departments who have discretion outside of formal policies to make work better for women) and other faculty members (as potential allies both in the department and within our professional organizations)—in a critical position to enact support and change. We conclude with our boldest call—to make a cultural shift that shatters the assumption that having a family is not compatible with academic success. Combined, we seek to launch a discussion that leads directly to necessary and overdue changes in how women scholars are supported in academia.

Opinions have been divided regarding the relevance of the APA Ethics Code to non-mental health specialties and even whether the code should attempt to encompass all psychology specializations. However, these opinions have crystallized without the benefit of any appreciable empirical data, until now. This study investigates the applicability of the ethical principles and standards of the code to 398 first-person narratives of ethical incidents reported by industrial-organizational (I-O) psychologists. On average, 2.8 (of the 5) principles enumerated in the code were deemed applicable to each incident, and each principle was applicable to more than half the incidents provided. Of the code’s 89 ethical standards, 75 (84.3%) were applicable to at least one incident. Among the 10 categories of standards, resolving ethical issues and human relations were the most frequently applicable, whereas therapy standards were virtually never applicable. However, for 42.7% of the incidents, trained judges identified a substantive deficiency or ambiguity for I-O psychologists in the code. These deficiencies were subsequently grouped into seven higher order categories (assessments in organizations; research practices; data management; professional interactions; business practices; student ethics; and proactive ethical behavior). Recommendations are offered for improving those putative deficiencies, and implications are discussed for I-O psychologists, the APA’s Ethics Code Task Force (ECTF), and other nonclinical domains of psychology.