This dissertation is composed of three essays in Empirical Industrial Organization and Financial Economics. The first essay, titled “Non-Compete Agreements in the Investment Advisory Industry,” studies how labor mobility constraints affect competition in the US investment advisory industry. In this industry, advisors play a critical role in the attraction and retention of clients. Non-Compete Agreements constrain advisors’ movement among firms except for the Broker Protocol members. I develop and estimate a dynamic industry equilibrium model that features firms’ strategic decisions on entry, exit, investment, and adoption of the Broker Protocol. Estimation results based on the data from 2011 to 2018 establish the role of the Broker Protocol in changing the market structure and industry markups. Given the structural estimates, I examine the consequences of policies that change the cost of entry and labor mobility for firms.

The second essay employs a novel approach to estimate applicant preferences with partially observed data from centralized matching mechanisms such as the Gale-Shapley Deferred Acceptance algorithm. In a Monte Carlo analysis, I illustrate the performance of the estimation method in recovering demand parameters. I apply this method to the university admission data from Iran. The dataset contains information on grades, rank-order lists, and admission results of more than 8,000 applicants matched to programs after being ranked in a centralized exam. Estimates of the demand parameters shed light on how disparities in locational preferences of female and male applicants form their choices. Moreover, the results suggest that gender-neutral policies aiming to enhance educational opportunities for applicants from underdeveloped areas can worsen gender disparities in higher education.

The third essay investigates the role of investment advisors’ misconduct in a Berk and Green-type rational model of investment management. The model generates two interesting implications. First, misconduct weakens the belief updating. In other words, the model implies that misconduct reduces the speed of updating investors’ beliefs about the advisor’s ability. However, when an advisor engages in more misconduct, she will experience faster investors’ belief updating in the future. Second, engaging in misconduct in addition to a mild negative correlation between advisors’ ability and misconduct decreases the correlation between survival rate and misconduct. I analyze and compare the model implications under three different assumptions about the relationship between advisors’ ability and misconduct. I further present empirical evidence consistent with the model findings that associate the probability of investment advisory firm closure to misconduct.