RESEARCH

Unemployment Insurance Monthly Benefits, Pay Frequency, and Claimants' Job Search Behavior  [JMP]

Draft (2023, Oct). (New Draft!)

Previously titles, "The Effect of Unemployment Benefit Pay Frequency on UI Claimants’ Job Search Behaviors", "Pay Frequency Matters: Evidence from Unemployment Insurance"

Presentations: Saint Louis University Sinquefield Center (SCAER) Research Workshop 2022, National Tax Association Annual Meeting 2021, Peking University NSD 2021, UC Santa Barbara Applied Workshop 2020

Benefit payment timing influences UI claimants' job search.

Abstract: This paper studies how the unemployment insurance (UI) benefit profile and payment schedule impact claimants' behaviors. The study reveals that liquidity-unconstrained claimants are less likely to exit UI in months following a high likelihood of an extra benefit check. Additionally, there is suggestive evidence that these claimants are less likely to exit UI when their benefit profiles begin with a high probability of extra benefits. Moreover, leveraging state-level policy variation in the benefit pay schedule, the paper documents that switching from a biweekly to a (smoother) weekly pay schedule induces claimants to have higher reservation wages and lower exiting hazard. This paper provides novel evidence that the timing and the monthly profiles of benefit payments are important to consider when designing social insurance policies

(with Hakan Özyılmaz) The Debt Payment Puzzle:  An Experimental Investigation [preparing for submission]

Draft (2023, Oct). (New Draft!)

Presentations: American Finance Association Poster Session 2023,  Financial Management Association 2022, Saint Louis University 2022, Society of Experimental Finance 2021*, Western Economic Association International (WEAI) 2021*, Economic Science Association (ESA) JMC Series 2020*, Southwest Experimental and Behavioral Economics Workshop (SWEBE) 2019*, Washington University St. Louis EGSC 2019*, Economic Science Association (ESA) North America 2019, UC Santa Barbara Experimental Economics Workshop 2019

Suboptimal debt repayment is linked to mental accounting and framing effects.

Abstract: Why do borrowing individuals fail to repay their debt optimally? We design a diagnostic laboratory experiment where we rule out selection into debt and other confounds present in the field as potential explanations. We document that allocations are predominantly suboptimal even when individuals are attentive to interest rates, equipped with optimization ability, and face unrealistically high interest rate differences. We use revealed preference methods and identify mental accounting as the main mechanism through a novel parametric test of fungibility. We further investigate if optimization failures extend to an algebraically identical investment problem. Our structural estimates reveal debt frame substantially increases fungibility violations compared to an algebraically identical investment frame. Choice process data document the debt frame increases subjects’ focus on the irrelevant balance information. These results have implications on boundedly rational models of decision-making, the design of consumer protection policies, and the evolution of wealth inequality.

(with Hakan Özyılmaz) Restoring Rational Choice in Repayments: Disclosures or Advice?  [preparing for submission]

Draft (2023, Oct). 

Presentations: National Tax Association Annual Meeting 2023 (scheduled), the 79th Annual Congress of the International Institute of Public Finance 2023, Society of Experimental Finance 2022*, Economic Science Association North America 2022

Relative to conventional disclosure policies, automated advice improves decision-making, yet individuals underutilize it.

Abstract: Borrowers with revolving debt on multiple accounts fail to exploit price differences in their accounts while making their repayments and leave a significant amount of money on the table. Constructing a simple repayment environment in the laboratory, we test the role of behavioral mechanisms that would directly inform the design of consumer protection policies. We find that providing salient interest rate disclosure has no effect, while disclosing the interest rate in a fee format has modest effects. In contrast, providing an opportunity to purchase automated financial advice reveals that subjects are predominantly aware of their choice inefficiencies and are relatively good at gauging the extent of their mistakes while underutilizing the advice they purchase. Our results suggest that promoting consumer financial technology applications that provide and implement automated financial advice is a more effective way of protecting consumers from simple arbitrage failures than conventional disclosure policies.

(with Jeffrey Cross) Tip Suggestions and Service Efficiency [under review]

Draft (2023, Oct). 

Presentations: Saint Louis University Sinquefield Center (SCAER) Research Workshop 2022, Hamilton College 2022*

Raising tip suggestions boosts taxi driver efficiency, with conditions.

Abstract: That customers respond to tip suggestions is well-documented, but less is known about how changing tip suggestions impacts service quality. Leveraging the unique setting of New York City taxicabs, we document that increasing tip suggestions improve driver efficiency (e.g., shorter distance) only when total fares do not respond to changes in distance or duration. Further analyses reveal that drivers' responses are driven by higher returns to fast turnarounds rather than an effort to induce higher tip rates. Findings from this paper thus provide novel evidence that changes in tip suggestions can impact supply-side behavior, such as service efficiency. Our results show, however, that the effect will likely vary based on the market setting, particularly the pricing mechanisms and the opportunity cost of slower service.

(with Jeffrey Cross) Focal Points for Giving [R&R - Journal of Economic Psychology]

Draft, Appendix (2023, Aug).

Previously titled, "Paying for Integers"

Presentations: Saint Louis University Sinquefield Center (SCAER) Research Workshop 2021, UC Santa Barbara Applied Workshop 2021

Integer tip suggestions increase tipping rates and amounts.

Abstract: Leveraging the unique context of New York City taxi rides, we estimate that passengers are more likely to tip a suggested amount when presented with an integer tip suggestion, which also corresponds with an increase in average tip rates. We find this behavioral response to integer suggestion varies by tip menu placement, fare amounts, deviation to social norm tip rate, and whether or not the total is also an integer. We show that these results are not driven by rounding heuristics and are consistent with integers acting as focal points instead of left-digit bias. Focusing on a 2012 rate fare change that increased the probability of integer tip suggestions by 700%, our estimates imply a transfer from riders to drivers of approximately 250,000 dollars in 2013.

(with Mike Farrell, Dermot Murphy, and Marc Painter) The Complexity Yield Puzzle: A Textual Analysis of Municipal Bond Disclosures [submitted]

 Draft (2023, Nov).

Presentations: Hawai’i Accounting Research Conference 2024 (scheduled)*, University of Nevada Reno 2023*, University of Illinois Chicago 2023*, the Brookings Municipal Finance Conference 2023*, Oklahoma State University 2023*, Dayton Summer Finance Workshop 2022*, Queens College of CUNY 2022*, Southern Illinois University*, the Virtual Municipal Finance Conference*

Complex municipal bond statements raise borrowing costs, particularly for retail trader-dominated clientele. Despite its cost, statement complexity rises over time. We show this is attributed to increased regulatory burden.

Abstract: We study the effect of official statement textual complexity on municipal borrowing costs (yield) through the clientele channel. Theoretically, complexity reduces signal quality for unsophisticated investors, potentially increasing yield. We provide causal evidence of an economically significant complexity-yield premium that is especially large for issues with greater tax-induced exogenous demand from unsophisticated investors or less complementary information from rating agencies. We decompose complexity into multiple topics and find that "legal complexity" matters most for the complexity-yield premium. Despite this premium, complexity has been trending upward across all credit categories. This trend is attributable to increased regulatory enforcement from the SEC.

SELECTED WORK IN PROGRESS

(with Will Gerken, Steve Irlbeck, and Marc Painter) Watching the Watchdogs: Tracking SEC Inquiries using Geolocation Data

Presentations: INFORMS Annual Meeting 2023*, University of New Hampshire 2023*

(with Yulia Merkoulova, Hakan Özyılmaz, and Chris Veld) Stock Return Ignorance: Information Frictions or Mental Gaps?

Intra-Monthly Time-Use Patterns: Evidence from Unemployed Workers in New Jersey

* presentation by co-author

TEACHING

TEACHING EXPERIENCE

Instructor [Maryville University of St. Louis]:

Econ 203, Principles of Economics 

Teaching Assistant [UC Santa Barbara]:

ECON 1. Principles of Economics-Micro

ECON 2. Principles of Economics-Macro

ECON 10A. Intermediate Microeconomic Theory I

ECON 100B. Intermediate Microeconomic Theory II

ECON 101. Intermediate Macroeconomic Theory

Recorded Sections (Spring 2021): link

ECON 134A. Financial Management 

ECON 134C. Behavioral Finance 

Exam Review (Winter 2019): slides, present-bias exercise

ECON 152. Personnel Economics

PSTAT 109. Statistics for Economics