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Certain characteristics of managerial employment arrangements and of the managerial labor market make shareholder wealth dependent on an executive's continued employment. These wealth effects are investigated by examining the common stock price reaction to unexpected deaths of senior corporate executives. Abnormal stock price changes are documented for a sample of fifty-three events. These abnormal stock price changes are associated with the executive's status as a corporate founder and with measures of the executive's' talents' and decision-making responsibility, and of the transaction costs associated with renegotiating or terminating the employment agreement.

We predict and find that accounting restatements that adversely affect shareholder wealth at the restating firm also induce share price declines among non-restating firms in the same industry. These share price declines are unrelated to changes in analysts' earnings forecasts, but instead seem to reflect investors' accounting quality concerns. Peer firms with high industry-adjusted accruals experience a more pronounced share price decline than do low-accrual firms. This accounting contagion effect is concentrated among revenue restatements by relatively large firms in the industry. We also find that investors impose a larger penalty on the stock prices of peer firms with high earnings and high accruals when peer and restating firms use the same external auditor. Our results are consistent with the notion that some accounting restatements cause investors to reassess the financial statement information previously released by non-restating firms.

Production of the placental hormone, chorionic gonadotropin (CG), increases dramatically as cytotrophoblasts fuse to form syncytiotrophoblasts. The CG ␣-and ␤-promoters are both responsive to cAMP, although the kinetics of cAMP stimulation are different. In an effort to understand the mechanisms of coordinate induction of these genes, AP-2 binding sites were identified in the promoter regions of the ␣ and CG␤ genes. AP-2 bound to the upstream regulatory element (؊186 to ؊156 base pairs (bp)) in the ␣-promoter and to several different regions of the CG␤ promoter, including footprints 2 and 4B (FP2, ؊311 to ؊279 bp; FP4B, 221 to ؊200 bp). AP-2 antibodies induced supershifts of these complexes, confirming the identity of the protein-DNA complex. In JEG-3 cells, which contain abundant AP-2, mutations in these CG␤ AP-2 sites reduced basal activity and decreased cAMP stimulation. In AP-2-deficient Hep-G2 cells, co-transfection of AP-2 stimulated expression of the CG␤ promoter 10 -20-fold, and the ␣-promoter was induced by 3-6-fold. Mutations that eliminate AP-2 binding to CG␤ FP4B reduced AP-2 stimulation by more than 80%, whereas mutations in FP2 reduced AP-2 stimulation by less than 50%. Analyses of AP-2 mutants revealed a requirement for the DNA binding/dimerization domain and the amino-terminal proline-rich and acid-rich transactivation domains for stimulation of the CG␤ promoter. Primary cultures of placental cytotrophoblasts were differentiated into syncytiotrophoblasts in vitro to examine AP-2 expression by reverse transcriptase-polymerase chain reaction. AP-2 mRNA levels increased by day 2 and continued to rise in parallel with a marked increase in ␣ and CG␤ gene expression. We conclude that both the ␣ and CG␤ promoters contain binding sites for AP-2 and suggest that this transcription factor provides a mechanism for coordinating the induction of these genes during placental cell differentiation.