My research interests include monetary policy, banking, and financial frictions. My PhD dissertation explores issues related to default risk and its intersection with monetary policy. My current research focuses on the impacts of student loan debt and regional issues pertaining to Washington State.
PUBLISHED PAPERS
Counterparty default risk and monetary policy in unsecured interbank lending markets. The Journal of Applied Business and Economics. Volume 22, issue 11: pg. 131-144. doi: https://doi.org/10.33423/jabe.v22i11.3739.
Lending standards, bank risk-taking, and monetary policy. The Journal of Accounting and Finance. Volume 19, issue 8: pg. 209-244. doi: https://doi.org/10.33423/jaf.v19i8.2625.
WORKING PAPERS
Endogenous Bank Monitoring, Loan Spreads, and the Amplification of Liquidity Shocks (preliminary draft; not to be distributed)
Abstract: I investigate the impact of costly loan monitoring on the response of output after a negative bank liquidity shock. A simple RBC model of an economy with a commercial loan market is constructed. Financial transactions are characterized by moral hazard on the part of borrowers which ultimately restricts borrower leverage. Lenders can alleviate the severity of the moral hazard problem by monitoring borrower projects after a loan has been made. The intensity of monitoring is optimally chosen by lenders: while more intense monitoring lessens the borrower’s moral hazard problem, it is costly. Compared to an economy without costly endogenous monitoring, costly monitoring results in a less severe drop in capital and output after a surprise increase in the cost of bank deposits. This is driven by the response of the bank’s net interest spread which falls when the cost of deposits rises. This leads to a larger rise in the excess return to capital over the cost of bank loans and contributes to a faster recovery in borrower net worth, capital, and output.
The Effect on Student Loan Debt on the Propensity to Hold Auto Debt
Abstract: This paper utilizes data from the National Longitudinal Survey of Youth 1997 cohort and an instrumental variable approach to investigate the impact of student loan debt on the likelihood an individual also holds auto debt while controlling for important confounding factors that influence the car ownership decision.