Although the media is often modeled as a faceless institution, its main output news content is generated by specific people. This is important because unlike, say, making tires or processing paper, writing is a fiercely individualistic craft that allows the author’s style, persuasion, views, or bias to be injected into the finished product. In this paper, we present direct evidence that the writing of specific journalists has a casual effect on aggregate market outcomes.
The practical and theoretical importance of credit card debt cannot be overstated. As a major contributor to household debt levels it plays an important role in the current financial crisis. In testimony to its widespread nature some 180 million Americans currently have a credit card (Lusardi and Tufano 2009) of which approximately half regularly carry unpaid credit card debt (Sprenger and Stavins 2008). Its importance has sparked renewed interest in the study of household finance and high-interest borrowers in particular (Campbell 2006; Lusardi and Mitchell 2008; Agarwal, Driscol, Gabaix and Laibson 2008; Tufano, Maynard and De Neve 2008; Lusardi and Tufano 2009; Zinman 2009). The variables used to explain variation in credit card usage revolve principally around age, gender, ethnicity, income levels, employment, and financial literacy.
In laboratory and real world situations, a correlation has been found between impulsivity and a variety of decision-making domains including financial choices (Frederick 2005; Benjamin, Brown and Shapiro 2006). Because credit card debt is generally viewed as a form of present oriented decision making it has also received the attention of those economists studying intertemporal choices and discounting (Laibson, Repetto and Tobacman 2007; Agarwal, Skiba and Tobacman 2009). A number of such studies find that individual variation in the propensity to make impulsive, present oriented decisions is associated with specific cognitive functions. For example, individual differences in valuing immediate and delayed monetary rewards can be traced to separate neural systems (McClure, Laibson, Loewenstein and Cohen 2004) and processes in the anterior prefrontal cortex, a region in the brain shown to support the integration of diverse information (Shamosh, DeYoung, Green, Reis, Johnson, Conway, Engle, Braver and Gray 2008).
American depository receipts (ADR) have become an important investment instrument. In Latin American countries for instance, type II and III ADR programs have increased in number from 22 at the end of 1994 to 80 by the first quarter of 2009. Type II and III ADRs are the most restrictive and trade on US stock exchanges like other US stocks, unlike type I or over the-counter (OTC) or Rule 144-A ADRs. Additionally, since level II and III ADRs trade on exchanges they quickly incorporate the effects of exchange rate fluctuations. Hence, we only analyze type II and III ADRs in this paper.
