Cesare Fracassi, associate professor of finance, shows that by defining a company’s risk level, agencies can sway some of its business decisions. When Moody’s Ratings reclassified some securities on companies’ balance sheets, it prompted them to borrow an average 22% more — perhaps because they could do so without hurting their credit ratings.

“They raised more debt, and they increased their investments, even though financially, nothing really had happened to the companies,” Fracassi says.

A study by the Cluster of Excellence ECONtribute published in The Quarterly Journal of Economics shows why people often draw different conclusions from company news than financial economics would suggest and how much this has to do with the way they think markets work.

For over 20 years, it has been a matter of dispute whether oxytocin bolsters trust. A new study conducted with the involvement of the University of Zurich now provides robust evidence that the hormone selectively increases trusting behavior in men with a low disposition to trust.

Federal investment in Native American communities and citizens continues to fall far short of needs, according to a new report from the Brookings Institution and the American Indian College Fund. A chronic issue for decades, this underinvestment has become more glaring in the wake of recent Trump administration cuts that have reduced outlays to Native Americans by more than a billion dollars.