Working papers
The Trade Credit Clearinghouse: Liquidity and Coordination (with Milan Božić) - 2nd round R&R at Journal of Finance, Resubmitted, December 2025
[Presented at: Bank of Canada, European Economic Association, IFABS 2021 Oxford, 24th Central Bank Macroeconomic Modelling Workshop, American Economic Association, Toulouse School of Economics, Bank for International Settlements, KU Leuven, University of Vienna, 2. Sljemenski razgovori, 29th Finance Forum. ]
We study the economic effects of a clearinghouse that allows a network of firms to reduce their gross debt burden through netting. The clearinghouse netted a sizable 8% of debt relative to GDP in the analyzed period. Exploiting unique data on the debt network and the clearinghouse algorithm, we identify plausibly exogenous variation in clearing for a particular firm that derives from changes in debts far away in the network. We show that clearing reduces the probability of default and increases firm performance. We find that the clearinghouse alleviates "missing-market" and coordination failure issues.
Amplifying Transmission of Monetary Policy Through Deposit Competition (with Bono Beriša and Ivan Mužić) - Submitted, June 2026
[Presented at: 6th Sljemenski razgovori, the IFABS 2025 Conference at the University of Oxford, 11th Research Workshop of the MPC TF on Banking Analysis, 8th ChaMP Workstream 1 Workshop in Lisbon and the Department of Finance Catch-Up at the University of St Andrews Business School. ]
We study the effects of a government initiative aimed at increasing the passthrough of monetary tightening to deposit rates. A large state-owned bank responded first to the initiative with a sharp and unexpected deposit rate increase. Competing banks quickly followed, albeit with substantial heterogeneity. The resulting deposit-rate shock led to a sizable increase in term deposits, driven primarily by ex-ante liquidity-rich individuals. Using matched deposit and residential real-estate purchase data at the individual level, we document a strong portfolio-rebalancing effect away from real estate. At the same time, consumption remains unchanged. Despite the sizable deposit reallocation, the shock does not affect the supply of loans to firms or households, consistent with high pre-existing bank liquidity. This setting provides a unique opportunity to uncover the effects of increased deposit competition and the ensuing deposit-rate shock on household portfolios, consumption, and bank lending.
Work in progress
The Network Effects of Clearing Trade Credit (with Milan Božić, Toni Whited and Leopold Zessner-Spitzenberg), Draft available soon
[Presented at: Humboldt University of Berlin (2022, coauthor)]
Network effects of financial shocks can be larger than the direct effect on an individual market participant as they naturally affect a larger set of agents. The network effect of clearing might even be negative, because clearing imposes seniority of cleared creditors' claims relative to non-cleared creditors. To study these effects, we develop an identification strategy that uses changes in the distant network of a particular firm on clearing of its debtors and creditors, thus providing plausibly exogenous variation in counterparty clearing for each firm. We find that clearing increases the sales, employment and intermediate goods purchases of the cleared firms counterparties. We develop a macroeconomic model with interfirm trade credit and clearing along the lines of Bigio and Lao (2020) and decompose the effects of clearing on cleared firms, their creditors, debtors and competitors analytically and quantitatively. Finally, preliminary results show that clearing raises aggregate consumption and labor by 0.7% and 0.4%, respectively, through reductions in efficiency and labor wedges caused by financial frictions.
Public Procurement, Competition and Markups (with Sampreet Goraya), Draft
[Presented at: Stockholm School of Economics (2023, coauthor), CREI Barcelona International Lunch (2021, coauthor)]
We provide evidence of market power in public procurement. Firms with ex-ante similar markups witness a 10% increase after winning a public procurement contract relative to firms that sell only to the private sector. Parallel with this increase in markups, profits increase as well, while labor share declines. Limited competition in public procurement is a potential driver behind these findings, given that 35% of contracts are awarded in a single-bid procurement procedure. We show that single-bid procurement consistently incurs higher prices than expected by the procuring body relative to a multi-bid setting, even for standardized products. Similarly, single-bid procedures are also associated with an increase in firm-level markups.
Loan supply and Prices (with Martin Pintarić), Draft available soon
[Presented at: Dubrovnik Economic Conference (2023), ECB 9th Research Workshop - Task Force on Banking Analysis for Monetary Policy (2023)]
We study how bank loan supply shocks to producers transmit to retail prices. We identify idiosyncratic loan supply shocks using the Amiti and Weinstein (2018) methodology and find that negative (positive) financial shocks lead firms to increase (decrease) prices, consistent with the cost-channel transmission of financial shocks. The results are driven by firms that rely on short-term financing and firms with higher market power. Additionally, we explore the interaction of energy costs and financial shocks in 2022 by exploiting the unexpected shock of war in Ukraine on energy prices for identification. We find that loan supply shock effects on prices are strongly amplified by the energy shock, in line with the literature on state-dependent price setting. This implies that the cost channel of financial shocks is especially relevant during supply-side shock episodes, thereby potentially lowering the ability of monetary policy to curb inflation and making financial stability important in the fight against inflation.
Price effects of joining the euro area: Evidence from Croatia (with Ivan Mužić, Michael Weber and Ivan Žilić), Draft available soon
We study the effects of euro adoption on price setting using detailed web scraped data for Croatia and neighboring countries. The unique feature of our dataset is that we match 250 thousand products from multinational companies and retailers across borders, which allows us to track the same product in the same retail chain but in different countries. For multinational retailers, we find price convergence across products that were both initially cheaper or more expensive relative to other euro-area economies. Non-multinational retailers do not exhibit such behavior, which we argue is due to lower price comparability, transparency, and market scope. In retail, rounding prices to psychologically attractive levels did not contribute to inflation. However, we find evidence that restaurants strongly increased prices by rounding them upwards.
