In Chapter 1, I revisit the effects of unilateral divorce laws on female labor supply. I use a variety of models to check the robustness of the results and find that the estimated effects on female labor supply are remarkably robust. The estimates I mainly use in this paper suggest that unilateral divorce laws increase female labor force participation rates by roughly 4-5 percentage points, and that these effects strengthen over time. There are also strong, long-term effects on the weeks and hours of work and on participation in full-time work. In addition, this paper compares the dynamic participation responses of married mothers versus married non-mothers, high education versus low education women, young versus old women and white versus black women. In Chapter 2, I investigate the racial differences in non-cognitive skills. The disparity in cognitive skills between white and black children has been studied extensively. However, the racial gap in non-cognitive skills has attracted much less attention. In this paper, I use ECLS-K to show that there are significant differences in non-cognitive skills between white and black students, even after controlling for a large set of background variables. I show that the gap is not exaggerated by teacher test-score bias against black students. Because subjective bias, on the contrary, attenuates the racial gap, I keep adding teachers' characteristics and use school fixed effects to measure the gaps of non-cognitive skills less biased. Strikingly, the more accurate gaps are much larger than the original gaps. The huge gap between whites and blacks in non-cognitive skills may help to explain the racial gap in wages, probability of arrest, teenage pregnancy, and other important outcomes in the United States. In Chapter 3, we show investors are surprised by the lack of a management forecast. Conditional on the same quarterly earnings news, cumulative stock returns prior to the earnings announcement date are higher in firm quarters with no management forecast than those in firm quarters with management forecasts. However, the difference in cumulative stock returns declines significantly after the earnings announcement. One possible explanation for the results is limited strategic thinking: investors underestimate the relation between management's strategic incentive to withhold information and the private information they have, which leads to the initial underreaction and the subsequent reversal. We contribute to the literature by showing that investors are constrained in understanding managers' strategic disclosure decisions, even when such decisions are salient to investors and repeated over time, and analysts and sophisticated institutional investors exist.
Read
