Publications

The Impact of Crisis-Period Interest Rate Declines on Distressed Borrowers

Review of Financial Studies, 2023. Pdf. SSRN. DOI. Code. Citation. AI Podcast.

Key Highlight: Distressed borrowers treated with larger benchmark interest rate declines benefit from increased debt-renegotiation and lower debt-service payments. However, following debt-renegotiation, surviving treated borrowers re-enter and linger in serious delinquency. Findings suggest that while monetary policy may effect reductions in benchmark rates and spur debt-renegotiation, such interventions alone may not lead to longer-run curative outcomes.

Review of Financial Studies, 2021. Pdf. DOI. Citation.

Key Highlight: This paper studies how financial constraints affect the housing market by exploiting a regulatory change that increases the down payment requirement for homes selling for 1M dollars or more. Result shows that the policy causes excess bunching of homes listed at $1M and heightened bidding intensity for these homes, but a muted response in sales.

Review of Financial Studies, 2021. Pdf. SSRN. DOI. Code. Citation.

Key Highlight: The California Foreclosure Prevention Laws, policies that increased the time and pecuniary costs of foreclosure, prevented 250,000 California foreclosures (a 20% reduction) and created $300 billion in housing wealth.

Regional Science and Urban Economics, 2020. Pdf. SSRN. DOI. Citation.

Key Highlight: Interest-only mortgages are broadly popular, as most households value reduced monthly payments.

Journal of Labor Economics, 2019. Pdf. SSRN. DOI. Code. Citation.

Key Highlight: This paper examines US and Canadian local labor markets. Wage levels and inequality rise over time with city population in both countries, albeit less in Canada. Local labor demand shifts raise nominal wages similarly. Chinese import competition had a weaker negative impact on manufacturing employment in Canada. These results are consistent with Canada’s more redistributive transfer system and larger, more educated immigrant workforce.

Applied Economics, 2019. Pdf. DOI. Citation.

Key Highlight: In 2015, the Danish government announced a tax hike on electric vehicles several months before its implementation. There was a dramatic surge in sales of Tesla Model S vehicles just before the tax came into effect, and a dramatic ebb in the months following.

Journal of Urban Economics, 2016. Pdf. SSRN. DOI. Citation.

Key Highlight: This paper uses Google search query data to develop a broad-based and real-time index of mortgage default risk.

Macroeconomic Dynamics, 2016. Pdf. SSRN. DOI. Code. Citation.

Key Highlight: This paper constructs a novel index of investor sentiment that is highly correlated with other behavioral indicators, but more closely tracks speculative episodes. The main new finding is that the effects of sentiment are asymmetric: During sentiment contractions high sentiment predicts low future returns for the cross section of speculative stocks and for the market overall, whereas the relationship between sentiment and future returns is positive but relatively weak during sentiment expansions.

Economics Letters, 2016. Pdf. SSRN. DOI. Citation.

Key Highlight: New capital requirements for systematically important financial institutions lower abnormal initial stock returns for systemically important financial firms that then reverse and dissipate after three days. Results are consistent with an initial overreaction and subsequent market correction to new capital requirements by equity market investors.

Journal of Banking & Finance, 2015. Pdf. SSRN. DOI. Code. Citation.

Key Highlight: During conventional times, a surprise decrease in the fed funds rate leads to a large increase in investor sentiment. Similarly, expansionary unconventional monetary policy shocks also have a large and positive impact on investor mood. Together, findings highlight the importance of both conventional and unconventional monetary policy in the determination of investor sentiment.