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Working Papers
Does Knowledge Protection Spur Common Ownership? (with Jiajun Tao, conditionally accepted at Management Science)
Does Knowledge Protection Spur Common Ownership? (with Jiajun Tao, conditionally accepted at Management Science)
Abstract: This paper examines whether the quest for information sharing drives the rise in common ownership. Our empirical setting exploits a state-level trade secret protection law that creates information frictions by restricting the mobility of knowledgeable workers across firms. Using a difference-in-differences framework, we find that these information frictions significantly increase common ownership, particularly in industries with greater human capital dependence, employee mobility, and technology spillover potential. The effect is predominantly driven by long-term and active investors, who have stronger incentives to influence corporate strategies. We further show that increased common ownership under the IDD is associated with improved innovation outcomes, stronger operating performance, and greater inter-firm knowledge diffusion. Overall, our findings suggest that the need for information sharing can be an important driver of common ownership.
Selected Presentations: LBS Transatlantic Doctoral Conference (2023); NFI-NBIM-Oxford Conference on Common Ownership (2023); RES & SES Annual Conference (2023); SGF Conference PhD Poster Session (2023)
Abstract: We study whether firms’ local employment footprints create product market value by aligning stakeholder interests. Using barcode-level scanner data and establishment-level employment data, we find that every one-percent increase in a firm’s local employment increases its local sales by 1.52%. Difference-in-differences estimates exploiting takeovers as shocks to firms’ employment footprint suggest a causal link. These effects increase with the importance and visibility of employment in a community, and do not reflect a pure supply mechanism. Employer products exhibit greater local availability and variety, while prices respond more strongly in employment counties when firms face short-term performance pressure. Overall, the findings reveal an employment-based channel linking labor markets to product market outcomes.
Abstract: We study whether firms’ local employment footprints create product market value by aligning stakeholder interests. Using barcode-level scanner data and establishment-level employment data, we find that every one-percent increase in a firm’s local employment increases its local sales by 1.52%. Difference-in-differences estimates exploiting takeovers as shocks to firms’ employment footprint suggest a causal link. These effects increase with the importance and visibility of employment in a community, and do not reflect a pure supply mechanism. Employer products exhibit greater local availability and variety, while prices respond more strongly in employment counties when firms face short-term performance pressure. Overall, the findings reveal an employment-based channel linking labor markets to product market outcomes.
Selected Presentations: Asia-Pacific Corporate Finance Online Workshop (2026); University of Melbourne (2026); 7th Nordic Initiative for Corporate Economics Conference (2026, scheduled)
The Umbrella-Effects Hypothesis: Evidence from Cartel Investigations (with Giacinta Cestone and Paolo Volpin, R&R at Journal of Corporate Finance)
The Umbrella-Effects Hypothesis: Evidence from Cartel Investigations (with Giacinta Cestone and Paolo Volpin, R&R at Journal of Corporate Finance)
Abstract: We study the impact of increased antitrust enforcement on incumbent firms using cartel cases opened by the European Commission between 1991 and 2022. Consistent with the umbrella-effects hypothesis, cartel outsiders (listed firms in the affected industry that are not under investigation) experience a reduction in profitability and investment (short-lived), and sales and employment (more permanent). The findings tend to be concentrated among firms that rely more on labor, are less productive and closer to financial distress. Relative to cartel outsiders, the investigated firms experience similar reductions in profits and investment, but substantial increases in employment.
Selected Presentations: 7th NHH Centre for Corporate Finance Conference (2024); 50th Annual Conference of EARIE (2023); Fordham University (2023); CMA Microeconomics Unit (2023); SKEMA Corporate Restructuring Conference (2023); Conference on Mergers, Innovation & the Labour Market (2022)
Abstract: This paper examines how firms manage their supplier bases in response to increased supply chain transparency. We document that firms "clean up" their supply chains when subject to Section 1502 of the Dodd-Frank Act, a regulation that mandates the disclosure of sourcing information on conflict minerals. Specifically, we find that firms cut ties with non-U.S. suppliers whilst maintaining relationships with U.S. suppliers. This pattern can be explained by the trade-off between adjustment costs and non-compliance costs. We show that firms replace high-risk suppliers with more ESG-compliant ones, a shift that translates to improved sales growth and higher firm value.
Abstract: This paper examines how firms manage their supplier bases in response to increased supply chain transparency. We document that firms "clean up" their supply chains when subject to Section 1502 of the Dodd-Frank Act, a regulation that mandates the disclosure of sourcing information on conflict minerals. Specifically, we find that firms cut ties with non-U.S. suppliers whilst maintaining relationships with U.S. suppliers. This pattern can be explained by the trade-off between adjustment costs and non-compliance costs. We show that firms replace high-risk suppliers with more ESG-compliant ones, a shift that translates to improved sales growth and higher firm value.
Selected Presentations: Journal of Corporate Finance Information, Contracts and Firms Conference (2025); 2nd Lake District Workshop in Corporate Finance (2025); 6th Nordic Initiative for Corporate Economics Conference (2025); FMA (2025)
Abstract: Disparities in firms' artificial intelligence (AI) adoption influence supply chain management. We develop a simple model that suggests a positive assortative matching of suppliers and customers in AI adoption. Empirically, we find that disparities in AI adoption between suppliers and customers destabilize existing relationships and prevent new relationship establishments. By estimating a structural supplier-customer matching model, we confirm that such positive assortative matching is economically optimal and that the effect of disparities in AI adoption on supply chain relationships is likely causal.
Selected Presentations: 6th Nordic Initiative for Corporate Economics Conference (2025); Third Aarhus Workshop on Strategic Interaction in Corporate Finance (2025); 22nd Corporate Finance Days (2025)
Abstract: We study whether CEOs' home preferences influence firms' supplier management. Firms maintain more stable relationships with CEOs' home suppliers, and these ties are more likely to terminate when a new CEO from a different state takes over. Consistent with the home bias hypothesis, we find that this favoritism in home suppliers can be explained by both the agency problem and place attachment. CEOs' preferences for home suppliers are stronger in weakly governed firms, and firms' performance improves when relationships with CEOs' home suppliers terminate. CEOs appear to give their home suppliers an edge, particularly when these suppliers face higher replacement or reputational risks.
Selected Presentations: Young Scholars Nordic Finance Workshop (2024); Research in Behavioral Finance Conference (2024); 17th Annual Meeting of the Academy of Behavioral Finance & Economics (2024); International Conference in Finance, Accounting and Banking (2024)
Abstract: This paper presents novel evidence suggesting that corporate customers play a disciplinary role in suppliers' short-term incentives. Using a comprehensive dataset of customer-supplier relationships, we show that major downstream firms respond to upstream firms' incentive of EPS management by severing business relationships. The effect stems from customers' concern over potential deterioration of suppliers' financial condition and is stronger for financially constrained suppliers. Ex ante, the threat of withdrawal by major customers deters suppliers from managing EPS. Suppliers with short-term incentives strategically reallocate trade credit to retain their largest customers, mitigating the ex-post impact of customer discipline.
Selected Presentations: 4th International Conference on Owners as Strategists (2024); 21st Corporate Finance Days (2024); CICF (2024); AEA Poster Session (2024); Junior Academics Research Seminars (JARS 2024); FMA European Conference (2023); RES & SES Annual Conference (2023)
Inactive Working Paper
Litigation Risk and Employment: Evidence from the Universal Demand Laws
Litigation Risk and Employment: Evidence from the Universal Demand Laws
Winner of the 2022 EFMA Larry Lang Corporate Finance Best Paper Award
Winner of the 2022 EFMA John A. Doukas Ph.D. Best Paper Award
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