We investigate the relation between earnings predictability, information asymmetry and the behavior of the adverse selection cost component of the bid‐ask spread around quarterly earnings announcements for NASDAQ firms. While we find an increase in the adverse selection component of the bid‐ask spread on the day of and the day prior to quarterly earnings announcements for firms with less predictable earnings, we find no evidence of such changes for firms with more predictable earnings. During a non‐announcement period, we find that firms with relatively less predictable earnings have consistently higher total bid‐ask spreads than firms with more predictable earnings. This finding suggests that firms with relatively less predictable earnings have a higher cost of equity capital than comparable firms with more predictable earning streams, ceteris paribus. Hence, earnings predictability may be a legitimate concern of managers who wish to minimize their cost of equity capital at least as it pertains to bid‐ask spreads.

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This study investigates the effects of state testing programs on the instructional practices of elementary teachers and the effects of such practices on their gifted students' attitudes toward school and motivation. Results obtained from a national survey of elementary teachers, representing a variety of metropolitan areas and school poverty levels, as well as qualitative case studies from teachers in three states suggest that the perceptions teachers have of standards, tests, and students shape their classroom actions. These findings indicate that teachers are not likely to engage in effective classroom practices but instead engage in one-size-fits-all practices. Implications of these perceptions on professional development and talent development are discussed.

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