The Rise of Negative Earnings and Demand Shifting Investment (opens in new tab)

We document the rise of negative earnings between 1980 and 2019: a secular increase in the percent of firms reporting losses, both among public firms and in the broader universe of US corporations, and a secular increase in the persistence of losses year-to-year among public firms. This rise has occurred alongside a spreading of the sales and earnings distribution and a recomposition of firm spending away from production costs and traditional in...