Working Papers

Bank balance sheet lending is commonly viewed as the predominant form of lending. We document and study two margins of adjustment that are usually absent from this view using microdata in the$10 trillion U.S. residential mortgage market. We first…

Despite great falls in global poverty, civil and ethnic conflict remains tragically common. In this chapter, I examine the patterns of persistence and change in conflict around the world through the lens of historical political economy. I compare…

We document regime change in the U.S. Treasury market post-Global Financial Crisis (GFC): dealers switched from a net short to a net long position in the Treasury market. We first derive bounds on Treasury yields that account for dealer balance…

We study how tax policies that lower the cost of capital impact investment and labor demand. Difference-in-differences estimates using confidential Census Data on manufacturing establishments show that tax policies increased both investment and…

We develop three complementary tests to examine how adverse selection affects the design of executive compensation contracts: First, we show that externally hired CEOs receive higher total pay and have fewer equity incentives relative to…

As early as St Augustine and Aquinas, philosophers have studied the epistemology of contradictions to natural laws (aka, miracles). In this article, we develop a game-theoretic framework to analyze the concept of a miracle as understood by…

Profit shifting by multinational corporations is thought to reduce tax revenue around the world. We analyze the introduction of standard regulations aimed at limiting profit shifting. Using administrative tax and customs data from Chile in…

An extensive literature examines whether senior executives’ contractual incentives influence their financial reporting decisions. However, little is known about whether —  and how — the incentives of lower-level (or “rank-and-file”)…

Equity book-to-market ratios (BTM) should not exceed one if a firm’s return on equity exceeds its cost of capital or it employs conservative accounting. Yet, BTM is above one for many firms, particularly in recession years. We address whether…

Translating the relevance of preclinical models (in vitro, animal models, or organoids) to their relevance in humans presents an important challenge during drug development. The rising abundance of single-cell genomic data from human tumors and…

The property tax is the most under-utilized tax in developing countries. We evaluate the revenue and welfare effects of the main policy instruments used to raise property tax revenue: tax rate changes and enforcement. Using administrative data…

This paper studies the construction of p-values for nonparametric outlier detection, taking a multiple-testing perspective. The goal is to test whether new independent samples belong to the same distribution as a reference data set or are…

We study three centuries of UK fiscal history. Before World War I, when the UK dominated global bond markets, the UK’s government debt was not always fully backed by its future surpluses. As predicted by theories of safe asset determination,…

This paper shows that stable net-interest margins of banks are uninformative about banks’ interest rate exposure. We show that neither deposits nor market power are essential for achieving stable net-interest margins (NIM) in long-short fixed…

The United States spends twice as much per person on pharmaceuticals as European countries, in large part because prices are much higher in the US. This fact has led policymakers to consider legislation for price controls. This paper assesses the…

Existing survival analysis techniques heavily rely on strong modelling assumptions and are, therefore, prone to model misspecification errors. In this paper, we develop an inferential method based on ideas from conformal prediction, which can…

Our study addresses whether integrated report quality, IRQ, is negatively associated with stock price synchronicity, an inverse measure of firm-specific information, and the extent to which the relation between IRQ and synchronicity is attenuated…

We empirically characterize how China is internationalizing the Renminbi by selectively opening up its domestic bond market and propose a dynamic reputation model to explain China’s internationalization strategy. While previously closed to…

We introduce a framework for calibrating machine learning models so that their predictions satisfy explicit, finite-sample statistical guarantees. Our calibration algorithm works with any underlying model and (unknown) data-generating…

Firms have ever increasing access to consumer data, which they use to personalize their advertising and to price discriminate. This raises privacy concerns. Policymakers have argued in response that consumers should be given control over…