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SSRN Research Paper Series
The Social Science Research Network’s Research Paper Series includes working papers produced by Stanford GSB the Rock Center.
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The Costs of Sovereign Default: Evidence from Argentina
Forthcoming in American Economic Review
We estimate the causal effect of sovereign default on the equity returns of Argentine firms. We identify this effect by exploiting changes in the probability of Argentine sovereign default…
Moral Hazard and the Optimality of Debt
I show that, in a benchmark model, debt securities minimize the welfare losses associated with the moral hazards of excessive risk-taking and lax effort. For any security design, the variance of the security payoff is a statistic that summarizes…
The Coevolution of Organizational Knowledge and Market Technology
A coevolutionary perspective on knowledge strategy is developed, where variant positions in knowledge space are predicted to result in differential advantages in product space. In particular, advantages to being both consistent and…
Dynamic Trading: Price Inertia and Front-Running
We build a linear-quadratic model to analyze trading in a market with private information and heterogeneous agents. Agents receive private taste/inventory shocks and trade continuously. Agents differ in their need for trade as well as the cost to…
Bankruptcy in Groups
We examine bankruptcy within business groups. Groups have incentives to support financially distressed subsidiaries as the bankruptcy of a subsidiary may impose severe costs on the group as a whole. In several countries around the world,…
Firm Financing Over the Business Cycle
Under revision for the Review of Financial Studies
We study the investment and financing policies of public U.S. firms. Large firms substitute between debt- and equity financing over the business cycle whereas small firms’…
How to Write an Effective Referee Report and Improve the Scientific Review Process
Drawing on insights of current and past editors of top economics and finance journals, we provide guidelines for reviewers in preparing referee reports and cover letters for journals. Peer review is fundamental to the progress of science and we…
Personalization in Email Marketing: The Role of Non-Informative Advertising Content
In collaboration with three companies selling a diverse set of products, we conduct randomized field experiments in which experimentally tailored email messages are sent to millions of individuals. We find consistently that personalizing the…
Psycho-Demographic Analysis of the Facebook Rainbow Campaign
Over the past decade, online social media has had a tremendous impact on the way people engage in social activism. For instance, about 26M Facebook users expressed their support in upholding the cause of marriage equality by overlaying their…
An Experimental Investigation of the Effects of Retargeted Advertising: The Role of Frequency and Timing
In collaboration with BuildDirect.com, an online seller of home-improvement products, we conduct a large-scale randomized field experiment to study the effects of retargeted advertising — a form of internet advertising in which banner ads are…
Benchmarks in Search Markets
We analyze the role of benchmarks in over-the-counter markets subject to search frictions. The publication of a benchmark can, under conditions, raise total social surplus by (i) increasing the volume of beneficial trade, (ii) reducing total…
Dynamic Certification, Reputation for Quality and Industry Standard
We study firm’s incentives to build and maintain reputation for quality, when quality is persistent and can be certified at a cost. We characterize all Markov-perfect equilibria where the timing of certification and investment depend only on firm…
Cost Competitiveness of Residential Solar PV: The Impact of Net Metering Restrictions
The policy of net metering allows operators of residential- and commercial solar PV systems to sell surplus electricity back to their utility at the going retail rate. This policy has recently been criticized on the grounds that it provides a…
Optimal Regulation of Financial Intermediaries
Revise and Resubmit at American Economic Review
I characterize the optimal financial regulation policy in an economy where financial intermediaries trade capital assets on behalf of households, but must retain an equity stake for…
Political Connections and the Informativeness of Insider Trades
This paper examines the relation between political connections and informed trading by corporate insiders in the context of the Financial Crisis. The unprecedented magnitude of government intervention, the substantial impact of this intervention…
The Size of the Core in Assignment Markets
We consider a two-sided assignment market with agent types and a stochastic structure, similar to models used in empirical studies. We characterize the size of the core in such markets. Each agent has a randomly drawn productivity with respect to…
Taxation and Corporate Risk-Taking
We study whether the corporate tax system provides incentives for risky firm investment. We analytically and empirically show two main findings: first, risk-taking is positively related to the length of tax loss periods because the loss rules…
Complementarities in Consumption and the Consumer Demand for Advertising
We use a new dataset that links the TV ad consumption behavior of a panel of consumers with their product choice behavior to measure the co-determination of demand for products and advertising. Leveraging the variation in the data, we assess how…
Framework Agreements in Procurement: An Auction Model and Design Recommendations
Framework agreements (FAs) are procurement mechanisms commonly used by buying agencies around the world to satisfy demand that arises over a certain time horizon. This paper is one of the first in the literature that provides a formal…