Working Papers

There are many studies where researchers are interested in estimating average treatment effects and are willing to rely on the unconfoundedness assumption, which requires that treatment assignment is as good as random conditional on pre-treatment…

We develop a model of advertising markets in an environment where consumers may switch (or “multi-home”) across publishers. Consumer switching generates inefficiency in the process of matching advertisers to consumers, because advertisers may not…

Institutional investors pay considerable attention to the quality of a company’s governance. Unfortunately, it is difficult for outside observers to reliably gauge governance quality. Oftentimes, poor governance manifests itself only after…

Keller Williams is one of the most successful real estate franchises in the world. The leaders of the company attribute its growth in large part to a cultural model that emphasizes profit sharing, interdependence, and success through the efforts…

We show that the allocation of failed banks in the Great Recession was likely distorted because potential acquirers of these banks were poorly capitalized. We illustrate this phenomenon within a model of auctions with budget constraints. In our…

Marriage can substitute for formal business contracts, especially in environments that lack a well-established system of contract or corporate law. In such settings, marriage can facilitate the efficient organization of labor and capital. In this…

We present a rational theory of reform fatigue. At each instant a politician chooses to divide effort between reforms and the status quo, and this choice is modeled as a two-armed bandit problem. Reforms are expected to yield a higher rate of…

This paper examines Meg Whitman’s tenure as HP’s CEO from September 2011 till March 2016. It considers the external contextual forces shaping radical changes in the information technology industry as well as the internal contextual forces…

CEO compensation is a highly controversial subject. While most company directors believe that CEO pay is not a problem, the majority of the American public believes that it is. The difficulties that boards face in justifying CEO pay levels in…

Compared to the predictions of complete market models, actual exchange rates are puzzlingly smooth and only weakly correlated with macro-economic fundamentals, suggesting that market incompleteness plays a key role in exchange rate dynamics.…

We construct a novel database containing the universe of financial advisers in the United States from 2005 to 2015, representing approximately 10% of employment of the finance and insurance sector. We provide the first large-scale study that…

In this paper we introduce a new computationally tractable framework for Ericson and Pakes (1995)- style dynamic oligopoly models that overcomes the computational complexity involved in computing Markov perfect equilibrium (MPE). First, we define…

I consider the monopolistic pricing of informational good. A buyer’s willingness to pay for information is from inferring the unknown payoffs of actions in decision-making. A monopolistic seller and the buyer each observes a private signal about…

We evaluate the effects of the 2009 Home Affordable Modification Program (HAMP) that provided intermediaries with sizeable financial incentives to renegotiate mortgages. HAMP increased intensity of renegotiations and prevented substantial number…

We study a Bayesian persuasion game in the context of real options. The Sender (firm) chooses signals to reveal to the Receiver (regulator) each period but has no long-term commitment power. The Receiver chooses when to exercise the option,…

This paper examines the approaches accounting researchers use to draw causal inferences using observational (or non-experimental) data. The vast majority of accounting research papers draw causal inferences notwithstanding the well-known…

In a large-scale field experiment, we demonstrate that advertising can serve as a signal that enhances consumers’ evaluations of advertised goods. We implement the experiment on a mobile search platform that provides listings and reviews for an…

What makes an asset a “safe asset”? We study a model where two countries each issue sovereign bonds to satisfy investors’ safe asset demands. The countries differ in the float of their bonds and their resources/fundamentals available to rollover…

We consider a problem where an uninformed principal makes a timing decision interacting with an informed but biased agent. Because time is irreversible, the direction of the bias crucially affects the agent’s ability to credibly communicate…

This paper explores the implications of asymmetric information and learning in banking. We hypothesize that banks acquire private information about borrower quality, not just when screening the initial loan, but while monitoring the loan’s…