Safety in Numbers: Mainstream-Seeking Diffusion in Response to Executive Compensation Regulations

Research across subfields has explored questions of how and why one political actor's decisions are affected by others'. I investigate recent executive compensation disclosure regulations to make theoretical, substantive, and methodological contributions to the diffusion literature. I emphasize mainstream-seeking in the face of monitoring from regulators, interest groups, or voters. When there are high costs to sticking out, actors may look at others to identify the safe mainstream. I investigate the diffusion of practices amongst the regulated to extend the literature beyond policy creation to equally important implementation questions. I show that diffusion is an important factor affecting legal and policy impact. I do so by measuring social learning in new ways taking advantage of quasi-random assignment to social learning opportunities and independent decision making treatments. I show that social learning opportunities had a substantial negative effect on the quality of disclosures and led to less varied reports.