Models of recursive preferences are commonly associated with a preference for early resolution of uncertainty, often regarded as an important economic channel in applications. This dissertation provides a different understanding of recursive preferences based on attitudes toward correlation, and in particular aversion to intertemporally correlated risks. Part 1 provides a...
Technology that processes text, audio and video, as well as location data, has revolutionized many industries by enabling innovative operations for customer retention. To retain transactions for a platform and viewers for advertisers, this dissertation leverages novel digital tools to analyze consumer behavior, proposes original economic frameworks to guide platform...
AbstractThis dissertation consists of three papers examining economic issues in developing countries.
The first paper studies how export activity affects prices in domestic consumer markets. Using extensive, spatially disaggregated data from India’s rice markets and exploiting a natural experiment provided by India’s rice export restrictions during 2007-2011, I show that,...
This thesis contains three chapters studying macroeconomics and trade. The chapters are organized into two topics: inflation expectations and perceptions, and the effect of trade intermediation on economic activity. In the first chapter, I investigate whether households are significantly harmed by inaccurate beliefs about inflation. The chapter analyzes two established...
In Chapter 1, I analyze optimal capital structure using a model in which firms issue securities in order to (1) finance investments in operations and (2) recapitalize the firm. In this trade-off model, firms balance the tax benefits of debt against the costs of financial distress. Key to the analysis,...
Pharmaceutical companies pay more than $2 billion to physicians every year. Most of these payments are for food and beverage, speaking, honoraria, consulting, and travel and lodging, which are termed “general payments.” These payments have come under increased scrutiny as critics of pharmaceutical promotion argue that they influence prescribing in...
In this dissertation, I cover three different topics in macroeconomics. In Chapter 1, I explore the macroeconomic implications of an increase in business competition and its micro transmission channels. In Chapter 2, I document a rise in savings and cash holdings by non-financial corporations across advanced economies and show that...
Chapter 1: If patients can be persuaded to switch between licensed providers on the basis of authoritative opinions, policy-makers can harness such reporting as a tool to implement incentives for high-quality care. I employ the landmark Flexner Report (1910) medical school evaluations to show that existing consumer beliefs and market-specific...
Economic development is a complex and multi-faceted process. Among its many causes, two are particularly consequential: government and technology. By shaping the landscape of economic incentives, they impact how agents interact, invest, and innovate, which in turn affects the creation of wealth. In this dissertation I explore how this interaction...
Economic activity is mostly performed by groups of agents that form organizations and collectives. In this dissertation I explore the effects of two frictions, namely conflicting preferences and contracting with externalities, on the characteristics of agents that jointly constitute a given organization or collective. First, in many professional environments workers...
This dissertation consists of three chapters on contract theory. In Chapter 1, ``Agency in Hierarchies: Middle Managers and Performance Evaluations'', I study the optimal joint design of incentives and performance rating scales in a principal-manager-worker hierarchy. The principal wants to motivate the manager and the worker to exert unobservable effort....
This dissertation proposes an oracle efficient estimator in the context of a sparse linear model. Chapter 1 introduces the penalty and the estimator that optimizes a penalized least squares objective. Unlike existing methods, the penalty is differentiable – once, and hence the estimator does not engage in model selection. This...
This dissertation examines three distinct empirical questions in macroeconomics and finance. Chapter 1 studies the reasons why households file for bankruptcy. The debt relief households obtain in bankruptcy provides insurance against wealth losses, but also distorts borrower incentives to repay debt, discouraging lending. Understanding how bankruptcy filings respond to changes...
Monetary Policy plays a crucial role in modern economies by supporting price, financial and economic stability. Its efficacy, however, exhibits variation both over time and across space leading to partially unpredictable and inconsistent outcomes. This thesis shows that the variation in the efficacy of monetary policy crucially relates to the...
In the first chapter I introduce the ideas that link selling information to surplus extraction. In my environment the seller may be uncertain about how much the buyer both has already learned before contracting with the seller (belief types) and is able to learn after contracting with the seller (information...
This dissertation explores our understanding of corporate credit ratings. In the first chapter I examine the issue of split ratings. S&P and Moody’s often differ in their initial ratings at bond issuance, producing what is referred to as a split rating. The consensus view in the literature and in practice...
In this thesis, I study the effects of spillovers in all-pay auctions and the effects ofregulating wages and hours on the labor market. In the first chapter, I study a model of
asymmetric all-pay auctions with spillovers. In this model, players compete for a prize, and
the sunk effort players...
The first chapter of this dissertation, coauthored with Martin Eichenbaum and Riccardo Bianchi-Vimercati, addresses the question: how sensitive is the power of fiscal policy at the ZLB to the assumption of rational expectations? We do so through the lens of a standard NK model in which people are level-k thinkers....
This dissertation consists of three essays in microeconomic theory. In the first two chapters, I study a class of partnerships where partners can exit and continue to free-ride on the remaining partners' efforts. The crucial force to deter players from strategic exiting is the ripple effect that it may trigger...