Research

Research Interests

I work on corporate finance. My research interests include corporate investment, the real effects of financial markets, private firms, internal capital markets, and M&A.

Publications

Inventory Behavior and Financial Constraints: Theory and Evidence (with Sudipto Dasgupta and Erica X.N. Li) 

Review of Financial Studies, Volume 32, Issue 3, 1 March 2019, Pages 1188-1233.

• EFA 2014; Five-Star 2016*; ... 

Do Private Firms (Mis)Learn from the Stock Market? 

Review of Finance, forthcoming.

• AFA 2023 (slides); Finance Down Under 2019;  EFA 2017; Early Career Women in Finance (WFA 2015); SAIF SIF; CICF 2016; Nordic Initiative for Corporate Economics (NICE); ... 

Credit Risk, Debt Overhang, and the Life Cycle of Callable Bonds (with Bo Becker, Murillo Campello, and Viktor Thell) 

Review of Finance, forthcoming.

• Previously circulated under the title ''Credit Risk and the Life Cycle of Callable Bonds: Implications for Real Corporate Decisions''

• NBER Summer Institute 2022 Corporate Finance (slides);  WFA 2022; Adam Smith Workshop 2022; NICE 2022; HEC-McGill Finance Workshop 2022; CICF 2019; ...

Working Papers

Analyst Specialization and Internal Resource Allocation in Firms (with Ling Cen and Sudipto Dasgupta)

• Universita Ca' Foscari Venezia Workshop on Labor & Finance 2022; SSE Brownbag; ... 

• Abstract: This paper studies the role of analyst specialization in the resource allocation of diversified firms. We show that minor segments of conglomerates are less likely to be covered by industry specialists compared to standalone firms and the major segment of conglomerates. Moreover, segment investment sensitivity to industry q varies with analysts’ industry specialization. We further explore a within-firm, exogenous shock on analyst specialization and find that investment decreased for segments that lost specialized analysts’ coverage relative to those that did not lose analyst following and those that lost only unspecialized analysts. Our evidence suggests that expert (under-)coverage has real effects on the investment (in)efficiency of conglomerates.

The Economics of Financial and Operational Hedging: Insights from U.S. Power Plants (with Alvin Chin-Te Chen, Ran Guo, and Haohang Wu)

• Supported by the Swedish Vinnova Grant

• Abstract: We study firms’ hedging policies using U.S. electric utilities as a laboratory for our theoretical and empirical analysis. Our parsimonious model of risk management highlights a tension between financial and operational hedging. The former reallocates risk to specialized investors, which lowers the firm’s cost of financing but also decreases the firm’s subsequent incentives to reduce risk by undertaking the latter. We provide evidence consistent with the model’s predictions. In particular, we document a financial hedge overhang: firms that hedge via financial contracts subsequently engage in less operational hedging (e.g., storing gas inventory).

Work in Progress

Does Board Busyness Hurt Shareholder Value? Evidence from Political Campaigns (with Ran Guo)

Analyst Information Contagion (with Zilong Niu)