Research

Working Papers

• Mergers with Intermediation: The Price Effect of Distant Hospital Mergers (with David Dranove and Benjamin Vatter)
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  Abstract: A substantial and increasingly salient class of M&A activity occurs across seemingly disconnected markets. Such cross-market or cross-geography mergers are of growing concern for competition authorities, yet evidence on them is scarce. We study cross-geography hospital mergers using private insurance data and show that mergers yield a 4.6% price increase at acquired hospitals. Using data on employer-sponsored health insurance enrollment and claims, we show that merger effects are strongly associated with overlapping employers across merging markets. We find no price increases when employer overlap is low and significant increases when overlap is high, a finding that persists even when merging parties serve disjoint healthcare markets. We provide evidence that integrated systems exert control over insurers' ability to win valuable employer contracts and secure higher payment rates. We find that cross-geography mergers reduce staffing, admissions, and costs, and increase markups at acquired hospitals.

• Fostering or Foreclosing? Acquisitions, Patent Controls, and Diffusion of Knowledge (with Ruofei Guo)
  Abstract: Acquiring a patent can speed an idea’s diffusion or strategically contain it. We study incumbent acquisitions of patented technologies and ask when deals are “acquired to build” versus “acquired to bury.” We develop and estimate a structural model in which firms bid for control and then choose whether to support integration and development or to shelve the technology to avoid cannibalization. The model separates implementation advantages from suppressive incentives and predicts post-acquisition diffusion trajectories and whether acquired knowledge spreads to outside innovators. Counterfactual policy experiments highlight a central trade-off: screening out the most suppressive acquisitions raises diffusion on average, but can also weaken acquisition-based returns thereby reducing ex ante innovation incentives.

• Dynamic Gains from the Market for Technology: Evidence from Pharmaceutical Licensing (with Shengmao Cao, Anran Li, and Jingyuan Wang)

Abstract: We estimate the dynamic impact of pharmaceutical licensing on firm-level innovation. Using a matched difference-in-differences design, we show that initial licensing deals lead to a significant increase in future project originations for licensors and licensees, respectively, relative to controls with identical pre-treatment trajectories. These productivity gains are broad-based across therapeutic markets and particularly pronounced for mid-development deals. Our results suggest that licensing and in-house R&D are complements, highlighting a novel channel through which the “market for technology” acts as a catalyst for innovation and growth.

Work in progress

• The Effect of AI on the Direction of Innovation: Evidence from Drug Discovery

• Effect of Long-term Care Insurance on Care Utilization and Labor Supply Substitution (with Jonathan Gruber)

• AI, Information, and the Allocation of Elder Care: Evidence from South Korea

• Reinsuring the Insurers of Last Resort (with David Dranove, Craig Garthwaite, Chris Ody, and Molly Schnell)