Hanna Onyshchenko

Financial Constraints and Capital-Labor Substitution in Response to Monetary Policy (Job market paper)

with Tereza Ranošová 

This paper investigates how firm leverage affects the transmission of monetary policy to labor demand. We find that expansionary monetary policy has a stronger effect on the employment of more leveraged firms but a weaker effect on their capital investment. We interpret these findings using a heterogeneous firm New Keynesian model with two types of wholesale firms facing financing constraints that differ by their leverage and a flexible constant elasticity of substitution (CES) production function of both wholesale and retail firms. In the cross-section, more leveraged firms shift to a less capital-intensive production mode in response to easing monetary policy. On the aggregate, more leverage dampens the response of capital and, thus, aggregate demand. As a result, employment response is initially muted but later amplified as firms substitute capital for labor.

"Real Effects of Innovation in Debt and Equity Securities” (draft available upon request, slides)

This paper examines financial innovation in U.S. capital markets by analyzing the issuance of new debt and equity instruments by non-financial firms. Drawing on detailed transaction-level data from Refinitiv Eikon we develop a high-dimensional classification of financial products based on key contractual features—including maturity, callability, convertibility, payment structure, and legal form—and identify more than 8,500 distinct product types issued between 1970 and 2020. By linking issuance data to firm-level balance sheet information, we show that firms introducing novel securities tend to be larger and older than those issuing only established products, suggesting that the fixed costs and risks of innovation act as barriers for smaller and younger firms. Additionally, we find that early adopters of new financial instruments subsequently exhibit faster growth in sales, capital expenditures, and employment compared to firms relying solely on traditional securities, consistent with the view that financial innovation is used to support firm expansion.

"Direct and Indirect Costs of War: The Case of Ukrainian Firms”

with Vitaliia Yaremko and Andriy Tsapin

How do wars affect firm performance? Using panel data on over 100,000 Ukrainian firms linked to high-resolution geolocated conflict data, this paper examines the impact of a wide range of war events, from those causing direct physical destruction to seemingly ``non-destructive'' events commonly omitted from the analysis of the costs of war. Exploiting within-firm variation, we show that war disrupts firm activity through multiple channels beyond physical damage. While direct military shocks, such as occupation and missile strikes, reduce firm capital, sales, and employment, even non-destructive events like air alarms and civilian-targeted violence significantly depress firm activity. These findings underscore the multifaceted costs of war and highlight the need for further research to fully quantify them.

"Local Institutions and Business Performance: Evidence from War-Torn Ukraine” (slides)

with Vitaliia Yaremko and Andriy Tsapin

"Bank specialization and the local effects of trade shocks” 

with Andrea Foschi and Fadi Hassan

Resting Projects

"Transmission of Soviet Privileges Across Time and Generations” (slides)

with Vitaliia Yaremko

This paper explores inequality and intergenerational mobility in Ukraine during the post-Soviet period. We investigate whether, and to what extent, Ukraine follows the general pattern seen in other ex-communist countries, where former communist elites carried their privileges through the transition. Using retrospective survey data on employment from 1986 or earlier, we identify individuals with high social status who were likely members of the Communist Party. We then track their individual and household-level outcomes in the post-1991 period using data from the Ukrainian Longitudinal Monitoring Survey. Our findings indicate that the persistence of privileges is stronger for wealth than for income and is more pronounced at the household level compared to the individual level. Overall, we document a limited persistence of Soviet-era privileges.