Research Interests

Corporate Finance, Political Economy, Labor Economics.

Working Papers

1. “From Bail Bonds to Foreclosures: The Financial Consequences of Pretrial Detention” with Pablo Slutzky (Presented at the Midwest Finance Association Meeting 2023.)

In the United States, a significant portion of inmates in local jails is detained awaiting trial. Given the direct and indirect costs associated with pretrial detention, detained individuals and members of their households may find it difficult to meet their financial obligations. Matching individual case-level data from the criminal justice system to household-level data on foreclosures, bankruptcies, and lien judgments, we examine how pretrial detention affects household solvency. Exploiting the quasi-random assignment of court commissioners to cases for identification, we find that pretrial detention results in higher rates of household insolvency. This effect is driven by an increase in the incidence of foreclosures during periods of decreasing house prices and by an increase in the incidence of Chapter 7 bankruptcies. Subsample analyses show that the overall insolvency effects are more pronounced among younger defendants living in houses they do not own—suggesting spillovers to older household members—and when households have less equity in the home. Lastly, we provide suggestive evidence that the insolvency effects are exacerbated when defendants borrow funds from commercial bail bondsmen.

2. “The Effect of Childcare Access on Women’s Careers and Firm Performance” with Elena Simintzi and Ting Xu (Presented at the Conference on Finance, Labor, and Inequality 2022, UBC Summer Finance Conference 2022, Labor and Finance Group Meeting 2022, WFA-CFAR Conference on Corporate Finance 2022, Colorado Finance Summit 2022, and Midwest Finance Association Meeting 2023. Scheduled for FIRS 2023.)

We study the effect of government-subsidized childcare on women’s career outcomes and firm performance using linked tax filing data. Exploiting a universal childcare reform in Quebec in 1997 and the variation in its timing relative to childbirth across cohorts of parents, we show that earlier access to childcare increases employment among new mothers, particularly among those previously unemployed. Earlier childcare access increases new mothers’ reallocation of careers into more demanding jobs in male-dominated firms, leading to higher earnings and higher productivity. Firms traditionally unattractive to women with children benefit from such reallocation, experiencing higher growth and performance. Our results suggest that childcare frictions hamper women’s career progression and their allocation of human capital in the labor market.

3. “The Effect of Political Rents on Corporate Investment: Evidence from Partisan Gridlock in the U.S. Senates” with Sahil Raina

We study whether corporate investment is stimulated or crowded out by redistributive government rents by exploiting changes in the partisan balance of the U.S. Senate. When the Senate is in partisan gridlock, senators from swing states are more likely to acquire rents for their constituents than senators from partisan states. We use this political dynamic to show that predicted increases in “political rents” lead to greater investment and higher valuations, in support of the stimulus hypothesis. We explore potential mechanisms behind this stimulus effect and find that swing-state firms benefit from higher federal spending, lower taxes, and favorable trade policies during gridlocked Senate terms. Lastly, we conduct an event study around the 2021 Senate runoff elections in Georgia and find that swing-state firms experienced higher stock returns relative to partisan-state firms following an unexpected even split in the Senate. This indicates that investors quickly incorporate the expected stimulus benefits from political rent redistribution into stock prices.

4. “The Effects of Voter Partisanship on Economic Redistribution: Evidence from Gerrymandering” with Sahil Raina (An earlier version of this project focusing on SBA lending was presented at the Paris December Finance Meeting 2019, ASU Sonoran Winter Finance Conference 2020, Finance Down Under 2020, Northeastern Finance Conference 2020, WFA Meeting 2020, EFA Meeting 2020.)

We study how voter partisanship affects economic redistribution. We model that partisan alignment between voters and their legislative representative reduces the representative’s incentive to serve her constituents’ economic interests. To identify shifts in partisan alignment, we exploit U.S. congressional redistricting and show that partisan gerrymandering produces predictable shifts in district-level voter partisanship. Comparing districts where the gerrymandering party’s candidate narrowly won and narrowly lost the pre-redistricting election, we find representatives insulated by favorable gerrymandering vote more frequently with their party on congressional bills and bring less discretionary federal spending to their districts relative to representatives exposed by unfavorable gerrymandering.

5. “Skilled Labor Access, Hiring Uncertainty, and Corporate Investment: Evidence from the H-1B Visa Program” (Presented at the SFS Cavalcade 2017, NFA Meeting 2017, AFA Meeting 2018, Paris December Finance Meeting 2020, CICF Meeting 2021, and EFA Meeting 2021.)

We study how immigration restrictions, a key source of friction in U.S. labor markets, inhibit corporate investment by a) rationing firms’ access to skilled labor, and b) creating uncertainty over firms’ access to skilled labor. First, we exploit a sharp reduction in the regulatory cap for H-1B visas in 2003 to show that firms that depended more heavily on H-1B workers beforehand reduced their investment relative to less dependent firms. To isolate the effect of supply rationing on investment, we exploit a temporal discontinuity in the ability of firms to apply for H-1B visas and find that visa rationing causes firms to reduce investment. Lastly, we investigate how hiring uncertainty affects investment by increasing the option value of delaying. Exploiting cross-regional variation in H-1B labor supply and cross-industry variation in H-1B labor demand, we find that relatively dependent firms tend to delay investment until uncertainty over H-1B hiring is resolved by the announcement of a binding cap. We further find that, consistent with models of irreversible investment, the investment delays are confined to industries where invested capital cannot be easily redeployed.

6. “Politics and Hidden Borrowing: Electoral Cycles and State Defined Benefit Pension Plans” (Job Market Paper, Presented at WFA Meeting 2017, Awarded WFA Cubist Systematic Strategies Ph.D. Candidate Award.)

I investigate how political incentives affect the policies of public-sector defined benefit (DB) pension plans in the United States. Incumbent Governors with discretion over state DB pension plan policies can borrow through the public pension system in a non-transparent manner by lowering contributions or raising benefits. In election year, the Governor faces the incentive to incur higher “pension deficits” in order to finance policies that improve his/her re-election chances. I document that such pension deficits are systematically higher in the final year of an election cycle, driven largely by election year decreases in governmental contributions. To formalize the intuition behind my findings, I present a stylized principal-agent model in which the key friction is temporary information asymmetry between incumbent politicians and voters regarding public pension policy. Consistent with the model’s predictions, the empirically documented electoral cycle pattern in pension deficits is stronger for pension plans that are more opaque and when gubernatorial elections are more closely contested. I also conduct falsification tests using private-sector DB pension plans in order to rule out alternative explanations for my findings.