Papers & Opinions


Paper


Posted on 5 August 2024

We review an empirical literature that studies how political polarization affects financial decisions. We first discuss the degree of partisan segregation in finance and corporate America, the mechanisms through which...

Paper


Posted on 27 November 2023

We examine the roles of commercial bank ownership and CEO faction membership in facilitating or in hindering the implementation of central bank policy in China. Both ownership and membership matter:...

Paper


Posted on 9 February 2023

Because of secrecy, little is known about the political economy of central bank lending. Utilizing a novel, hand-collected historical daily dataset on loans to commercial banks, we analyze how personal...

Paper


Posted on 4 August 2022

We characterize conditions under which the majority of voters supports a bailout despite incurring bailout expenditures. This yields inefficiently high investments when economic prospects are good. When economic prospects are...

Paper


Posted on 16 March 2022

We study how banks’ special interests affect the resolution of failed banks. Using a sample of FDIC auctions between 2007 and 2016, we find that bidding banks that lobby regulators...

Paper


Posted on 17 January 2022

This paper investigates the political ties of too-big-to-fail bank boards in crisis times. We argue that after a bailout, governments are likely to influence bank board compositions to secure control...

Paper


Posted on 8 December 2021

This paper examines the incidence of special interests in the allocation of loans through the Paycheck Protection Program (PPP). We find that lobbying at the firm and industry levels helps...

Paper


Posted on 8 November 2021

In a general equilibrium framework, we study the cost incurred by banks to ''buy" influence on capital regulation via campaign contributions. Our central result is that banks buy influence at...

Paper


Posted on 10 October 2021

This paper investigates whether parliamentary hearings are effective in holding central banks accountable against their mandates. To this end, it applies text analysis on the hearings of the Bank of...

Paper


Posted on 4 October 2021

Does partisan perception shape the flow of international capital? We provide evidence from two settings, syndicated corporate loans and equity mutual funds, to show that ideological alignment with foreign governments...

Opinion


Posted on 16 September 2021

Recent wildfires in Turkey have not only destroyed more than 95,000 hectares of its coastal forestland but also divided the country further into its political colors. This piece discusses the...

Opinion


Posted on 6 September 2021

The regulatory architecture of the financial system has significantly changed after the global financial crisis of 2008/09. In Europe, the introduction of the Single Rulebook has been a major change...

Paper


Posted on 11 August 2021

We analyze the introduction of retail central bank digital currency (CBDC) into a two-tiered monetary system. Deposits, reserves, and CBDC differ in terms of operating costs and liquidity. We identify the optimal...

Paper


Posted on 30 July 2021

We document a strong political cycle in bank credit and industry outcomes in Turkey. In line with theories of tactical redistribution, state-owned banks systematically adjust their lending around local elections...

Paper


Posted on 7 July 2021

The U.S. government uses its voting power to direct IMF loans to countries where U.S. banks are exposed to sovereign default—a de facto bailout. This effect is stronger in years...