Corporate Finance, Political Economy, Labor Economics.
1. “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.
2. “Skilled Labor Rationing, Hiring Uncertainty, and Corporate Investment: Evidence from H-1B Visa Application Deadlines” (Presented at the Paris December Finance Meeting 2020, CICF Meeting 2021, EFA Meeting 2021. Based on an earlier project presented at SFS Cavalcade 2017, NFA Meeting 2017, AFA Meeting 2018)
I study how high-skilled immigration restrictions affect corporate investment by a) setting ex-post constraints on firms’ access to skilled labor, and b) creating ex-ante uncertainty over skilled hiring. First, I exploit a temporal discontinuity in firms’ ability to apply for H-1B worker visas, and find that ex-post rationing of visas leads to lower capital expenditures. These effects are concentrated in tight labor markets, which suggests that skilled immigrants help mitigate labor market frictions, and in firms seeking to fill lower-wage positions, which suggests that foreign labor facilitates investment by being relatively cheap. Second, using the historical distribution of immigrants to identify ex-ante exposure to visa supply shocks, I find that exposed firms periodically delay investment until hiring uncertainty is resolved. Consistent with models of irreversible investment, these cyclical patterns are concentrated in firms using less-redeployable capital.
3. “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.