Research
Job Market Paper
How do firms respond to rising environmental concerns of consumers? We investigate this question for the automotive industry in the US using a shift-share instrumental variable approach. We construct a novel dataset at the firm-level to instrument changes in household preferences with natural disasters. Our findings suggest that firms not only engage in cleaner innovation but also increase their lobbying on environmental topics. We show that the increase in environmental lobbying and clean patenting follow the same dynamics which points to a complementarity between the two strategies. These results can be understood as firms using lobbying to increase the value of clean patents: higher environmental standards tailored to the firm's new clean technologies diminish the competition the firm faces.
Working Papers
Short and Long Term Investments : How Firms Construct and Cash In Political Influence (joint with Elodie Andrieu)
How does corporate lobbying affect firm performance? We provide evidence that lobbying and campaign contributions are strategically linked, and firms use campaign contributions as long-term investments since legislators will enter important committees over time. We exploit this complementarity using a shift-share instrumental variable approach to estimate the impact of lobbying on firm size, financial performance and investments. We find that lobbying positively impacts sales, financial performance and capital expenditures, but not R\&D expenditures, with effects larger than previously reported in the literature.
[Draft available upon request]
2023 European Association of Law and Economics Young Economist Award
Innovation or lobbying: who chooses what against foreign competition?
This paper studies the relationship between competition and firms’ political influence. I use the China shock identification strategy to assess the impact of rising imports over the last two decades on U.S. corporate lobbying. The empirical results are the following : i) the increase in foreign competition has brought firms to increase their lobbying effort by approximately 28 percent per four-year period, ii) results are heterogeneous and the increase is focused on low productivity firms, iii) this increase does not target trade policies specifically but rather a variety of topics contributing to firms’ competitiveness. I comment two mechanisms : first, firms for which innovation is too expensive naturally increase their lobbying effort in proportion to the threat of competition, and second, exit from the less competitive firms and innovation from the most competitive ones concentrate the lobbying effort on fewer firms, decreasing free-riding in lobbying.
Publications
Lobbying Behind the Frontier (with Matilde Bombardini and Francesco Trebbi) in U. Akcigit and J. Van Reenen, (eds.) The Economics of Creative Destruction, Harvard University Press, 2023.
Seminar
I am one of the co-organizer of the Economics of Innovation Seminar joint between the College de France, the INSEAD and PSE. If you wish to present at the seminar and book a date, please send an email with the title and abstract of your paper.