Publication

Motivating collusion (with Fangyuan Ma and Alminas Zaldokas) [link]

Journal of Financial Economics, 2024

CRESSE – CPI and the CCIA Young Researcher Award

We examine how executive compensation can be designed to facilitate product market collusion. We look at the 2013 decision to close several regional offices of the U.S. Department of Justice, which lowered antitrust enforcement for firms located near these closed offices. We argue this made collusion more appealing to shareholders, and find that these firms increased the sensitivity of executive pay to local rivals’ performance, consistent with rewarding the managers for colluding with them. The affected CEOs were also granted longer vesting periods, which provides long-term incentives that could foster collusive arrangements.

Presentations: Drexel Corporate Governance Conference 2023, 32nd CFEA 2022, AEA 2021, Barcelona GSE Summer Forum (Applied Industrial Organization) 2021, CUHK Greater Bay Conference 2021, MFA 2021, IIOC 2021, New Zealand Finance Meeting 2021, FOMC 2020, NYU Law/American Bar Association Next Generation Antitrust Scholars’ Conference 2020, Finance in the Cloud IV, Asia-Pacific Corporate Finance Online Workshop, Corporate Finance Day 2020 (Liege), Paris Corporate Finance Webinar, University of Maryland, University of Pittsburgh, Columbia Business School, HKUST, Fordham University, NUS, University of Technology Sydney, and University of Sydney.

Working papers

Does Foreign Institutional Capital Promote Green Growth for Emerging Market Firms? (with Sophia Chiyoung Cheong, Jaewon Choi, Ji Yeol Jimmy Oh)[Draft]

Best Paper Award at Cornell ESG Investing Research Conference 2023

We examine whether foreign institutional capital promotes green growth in emerging-market firms, using firmlevel and China A-shares’ market-level inclusions in the MSCI Index as shocks to foreign capital. While foreign capital boosts output in emerging-market firms, emissions rise disproportionately, leading to substantial increases in emissions intensity. In contrast, emissions intensities of developed-market firms tend not to increase with foreign capital. These increases in emissions intensity are concentrated in emerging markets with weaker environmental regulations and firms held by funds driven more by financial incentives, consistent with financial concerns dominating environmental concerns in emerging market investors. Overall, results suggest that environmental considerations are assigned lower priority when emerging-market firms utilize foreign capital for growth.

Presented at CEBRA International Finance and Macroeconomics Meeting 2024*, CICF 2024*, Cornell ESG Investing Research Conference 2023, EEA 2023, ECB Emerging Market Group workshop 2023, SFS Cavalcade 2023* and more

Seminar presentations: Federal Reserve Board (Supervision and Regulation, Policy Effectiveness Assessment Section), Australian National University*, Copenhagen Business School, EWHA University*, ESSCA School of Business*, Korea Money and Finance Association*, Rutgers University*, Tsinghua University*, University of Illinois Urbana-Champaign*, University of New South Wales*, Victoria University of Wellington*, Yonsei University*, Conferences: AFFI 2023, Asia-Pacific Association of Derivatives 2023*, CEBRA International Finance and Macroeconomics Meeting 2024*, CICF 2024*, Conference on CSR 2023*, Cornell ESG Investing Research Conference 2023, Day Ahead conference by FRB SF, EEA 2023, ECB Emerging Market Group workshop 2023, FMA 2023*, FMA Applied Finance 2024, Global AI Finance Research Conference 2022, ISB Summer Research Conference 2023*, KFA-TFA Joint Conference 2023*, SFS Cavalcade 2023*, Symposium on ESG Research at NCCU*

Committing to Clean: Corporate Environmental Investment and Labor Market Competition (with Manpreet Singh)[New draft on the way!]

Do firms actively invest in a clean working environment to retain workers when labor market competition is expected to intensify? Using manufacturing plant location contests, we show that incumbent plants in winning counties reduce on-site toxic releases by 9.3% after new plant entry announcement, with the largest declines among hazardous chemicals, no corresponding reduction in off-site transfers, and no loss of economic output. The reductions are achieved through process and production modifications, the most capital-intensive and least reversible category of abatement. We find that results are not necessarily driven by regulatory pressure or investor scrutiny. This effect is stronger when incumbent plants share a similar labor pool with new plants or are in skill-intensive industries, and when the new plant is expected to be cleaner than the incumbent plants. The incumbent firms, which reduced toxic releases, experience lower wage growth and worker turnover ratio. A back-of-the-envelope estimate shows a savings of $3.38 in wages for a dollar abatement expenditure. Our findings demonstrate that firms commit to environmentally cleaner working spaces by making irreversible abatement investment, motivating environmental improvement beyond external regulatory or market constraints.

Presentations: LERA@AEA 2027, Copenhagen Business School, RCF-ECGI 2026, KER 2026, SDU conference 2026, IIOC 2026, University of Copenhagen, Seoul National University, University of Gothenburg

Geopolitical Conflict Penalty within Firms (with Iris Wang)[New draft by request]

We ask whether the history of armed conflicts shapes internal human capital allocation through immigrant firm owners' beliefs. Using administrative Canadian employer-employee matched data linked to the universe of historical bilateral conflicts since 1946, we identify matches between the origins of immigrant firm owners and those of immigrant workers. We find that conflict-origin immigrant workers are paid about 8\% less compared to non-conflict-origin immigrant workers with similar characteristics. The penalty reflects the owner's valuation rather than worker quality: it is present at hire, persists under worker fixed effects, and does not predict later exits or earnings declines. Conflict-origin workers are also deployed in low-pay jobs and face a lower probability of reaching the top of the earnings distribution compared to their similar coworkers. As a firm's share of conflict-origin workers rises, it saves on wage costs but does not achieve higher profitability; instead, these firms grow more slowly both in sales and employment. Finally, the penalty attenuates with within-firm tenure and verifiable host-country credentials, but does not scale with conflict recency, consistent with an information friction rather than fixed animus. The results imply that as migration brings owners and workers from more countries into the same firms, it also brings the information friction arising from historical rivalries between those countries into the workplace.

Presentation: GRASFI 2026, ENTFIN* 2026, FMA* 2026, Labor and Employment Relations Association (LERA) Annual Meeting 2026, EsFA 2026, EEA* 2025, UBC Summer conference* 2025, AOM 2025, McMaster University*, Midwest Political Science Association* 2025, Copenhagen Business School

(The views expressed in this article are those of the authors and do not necessarily reflect the views of Statistics Canada.)

Outsourcing Workplace Safety [Draft]

I study if firms deliberately sacrifice workplace safety for profits by using contract workers, for whom they are not legally liable. I exploit a regression discontinuity design around the amendment to the Occupational Health and Safety Act in Korea, 2017, which expanded the legal accountability of firms to cover contract workers. The number of contract workers decreased by 18.1% in affected establishments compared to unaffected establishments. This change was not compensated by direct hiring, causing overall employment to fall by 1.3%. Working hours and wage costs paid to directly hired employees increased to make up for the resulting losses in work hours from the contract workers. Workplace safety improved at affected establishments at the cost of higher safety investment. Profitability dropped in affected firms, and those firms reacted by shrinking investments. The results are consistent with firms strategically outsourcing risky jobs to contract workers to offload their duties on workplace safety.

Presentations: LERA Meeting at AEA 2023, CICF 2022, EALE 2024, MFA 2023, and more

Presentations: AFFECT-AFA 2024, Amsterdam Business School, BI Norwegian Business School, Boston University, CEFER, CICF 2022, Conference on CSR, the Economy and Financial Markets 2022, Copenhagen Business School, EALE 2024, ESCP Business School, FMA 2021, IESE Business School, Ivey Business School, LERA Meeting at AEA 2023, Manchester Business School, MFA 2023, Nordic Initiative for Corporate Economics, San Diego State University, The Economics of Working Environment conference, University of Luxembourg, University of New South Wales, Venice Finance Workshop 2023, Wilfrid Laurier University

Investment Decisions of Corporate Foundations and Controlling Shareholder Entrenchment [Draft]

We study how corporate foundations use capital for the benefit of controlling shareholders at the expense of the value of minority shareholders. Using the 2013 Fair Trade Act amendment in Korea, restricting ownership concentration by controlling shareholders in large business groups (chaebols), we conduct difference-in-differences tests and find that corporate foundations of exposed chaebols increased ownership in member firms by 5%, preserving ownership of controlling shareholders. Market reacts negatively, mainly in member firms with past donations, and the member firms’ value of cash donations decreases. Exposed corporate foundations reduced philanthropic expenses. Results suggest that resources in corporate foundations are extracted to benefit controlling shareholders, undermining donation value for minority shareholders.

Presentation: Erasmus Corporate Governance Conference 2025, CEPR Workshop on Behavioral Perspectives on Family Firms 2024, AFBC 2019 ... More

Recent discussions

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Dirty Air and Green Investments: The impact of pollution information on portfolio allocations by Fisman, Ghosh, Sarkar, and Zhang at MFA 2025 (slide)
Chronic Physical Climate Risk and Corporate Financial Policies by Geng at NFN PhD Workshop 2025 (slide)
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Directing the Labor Market by Begley, Haslag, and Weagley at EFA 2024 (slide)

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