1- “When Deposits are Uninsured: Revisiting the Bank Liabilities Channel” (with Evren Damar) - slides
2- "Geopolitical Shocks and International Financial Stability: What Can We Learn from Loan Syndicates’ Exposure to Russian Firms?" (with Pablo Hernando-Kaminsky and Andreea Rotarescu)
3- “Markup Heterogeneity, Openness and the Pro-Competitive Gains from Trade with Persistent Trade Relationships” (with Paul Ko and Wei Qian)
How do pro-competitive gains from trade change in a dynamic setting? We build a two-country general equilibrium model featuring deep habits, following Raven and Uribe (2006). Introducing deep habits in our model creates a dynamic, intertemporal effect in the determination of markups. In previous literature, trade liberalization increases competitive pressures on domestic producers, and trade reduces cross-sector variation in markups, reducing misallocation and raising aggregate productivity. In our setup, a reduction in trade costs introduces an additional dynamic effect, in which demand elasticity and markups are endogenous not only for market shares but also for the quantity of intermediate goods imports. We then take our model to the firm-level Indian data to quantify the pro-competitive effects of trade liberalization under deep habits.
4- “Lending to the Unbanked: A New Database and New Insights”
Alternative Financial Services (AFS) refer to a wide range of financial products and services that are offered outside of traditional banking systems: payday, pawnshop, title and peer-to-peer (P2P) loans, non-bank check cashing, refund anticipation loans (RALs), and rent-to-own (RTO) stores. AFS is a sizable industry used by 25% of Americans and 50% of those making less than $30K/year. It serves the “unbanked” or “underbanked” who live paycheck-to-paycheck and do not have a checking, savings, or any other type of bank account. AFS borrowers are usually returning or repeat borrowers, which creates dangerous and costly debt traps for them. All these products entail high costs, inherent to the default risk of lending to the poor. To date, existing databases on AFS (mostly surveys) concentrate on the “who” and the “why” of AFS, namely, describing what are the demographic characteristics of people who typically borrow from alternative lenders, and why they do so even when the cost is so high. We know quite a bit about the access and usage of AFS, but very little about the lending conditions, i.e. the “how?” of AFS. Our first goal with AFS-New Data is to start bridging this gap by building a dataset on these conditions (interest rates, fees and other costs, loan-to-value and debt-to-income ratios) and to link them to demographic information on borrowers and their zip code of residence. Our second goal is to provide regulators and policy makers with a toolkit that allows for better enforcement of laws around anti-predatory and anti-discriminatory lending. This project involves a large team of undergraduate RAs, to train and encourage them to become the next generation of academics and leaders in policy.
5- "Heterogeneities in Loan Covenant Types Across the Firm Size Distribution”
6- “Labor Market Informality, Financial Development and Income Distribution”
We study how heterogeneities in firms’ productivity allow these firms to endogenously “select” into the informal or formal sectors of the economy. These sectors differ from each other along two dimensions: (1) the degree of access to credit markets, and (2) the type of frictions in labor markets that give rise to unemployment. We develop a theoretical model that allows us to study the implications of financial liberalization on firms’ access to the formal sector, consumers access to credit markets and the resulting impact on inequality and income distribution.
2- "Geopolitical Shocks and International Financial Stability: What Can We Learn from Loan Syndicates’ Exposure to Russian Firms?" (with Pablo Hernando-Kaminsky and Andreea Rotarescu)
3- “Markup Heterogeneity, Openness and the Pro-Competitive Gains from Trade with Persistent Trade Relationships” (with Paul Ko and Wei Qian)
How do pro-competitive gains from trade change in a dynamic setting? We build a two-country general equilibrium model featuring deep habits, following Raven and Uribe (2006). Introducing deep habits in our model creates a dynamic, intertemporal effect in the determination of markups. In previous literature, trade liberalization increases competitive pressures on domestic producers, and trade reduces cross-sector variation in markups, reducing misallocation and raising aggregate productivity. In our setup, a reduction in trade costs introduces an additional dynamic effect, in which demand elasticity and markups are endogenous not only for market shares but also for the quantity of intermediate goods imports. We then take our model to the firm-level Indian data to quantify the pro-competitive effects of trade liberalization under deep habits.
4- “Lending to the Unbanked: A New Database and New Insights”
Alternative Financial Services (AFS) refer to a wide range of financial products and services that are offered outside of traditional banking systems: payday, pawnshop, title and peer-to-peer (P2P) loans, non-bank check cashing, refund anticipation loans (RALs), and rent-to-own (RTO) stores. AFS is a sizable industry used by 25% of Americans and 50% of those making less than $30K/year. It serves the “unbanked” or “underbanked” who live paycheck-to-paycheck and do not have a checking, savings, or any other type of bank account. AFS borrowers are usually returning or repeat borrowers, which creates dangerous and costly debt traps for them. All these products entail high costs, inherent to the default risk of lending to the poor. To date, existing databases on AFS (mostly surveys) concentrate on the “who” and the “why” of AFS, namely, describing what are the demographic characteristics of people who typically borrow from alternative lenders, and why they do so even when the cost is so high. We know quite a bit about the access and usage of AFS, but very little about the lending conditions, i.e. the “how?” of AFS. Our first goal with AFS-New Data is to start bridging this gap by building a dataset on these conditions (interest rates, fees and other costs, loan-to-value and debt-to-income ratios) and to link them to demographic information on borrowers and their zip code of residence. Our second goal is to provide regulators and policy makers with a toolkit that allows for better enforcement of laws around anti-predatory and anti-discriminatory lending. This project involves a large team of undergraduate RAs, to train and encourage them to become the next generation of academics and leaders in policy.
5- "Heterogeneities in Loan Covenant Types Across the Firm Size Distribution”
6- “Labor Market Informality, Financial Development and Income Distribution”
We study how heterogeneities in firms’ productivity allow these firms to endogenously “select” into the informal or formal sectors of the economy. These sectors differ from each other along two dimensions: (1) the degree of access to credit markets, and (2) the type of frictions in labor markets that give rise to unemployment. We develop a theoretical model that allows us to study the implications of financial liberalization on firms’ access to the formal sector, consumers access to credit markets and the resulting impact on inequality and income distribution.