Why Do (So Many) Corporate Bonds Pay Coupons?
Firms pay a significant fraction of the total cash flow of corporate bonds in the form of coupons before the maturity date. Understanding why firms favor this bond structure has been overlooked by the literature, in part because standard models imply no cost-of-capital effect from making early payments (Modigliani and Miller, 1958). The goal of this paper is to study, empirically and theoretically,...
Sukjoon Lee, NYU Shanghai
Wednesday, May 21, 2025 | 2:00pm - 3:30pm | Room 337
More Details
Subjective Expectations and Financial Intermediation
Using a customized survey and an information-provision experiment, we establish that loan officers’ individual subjective expectations about inflation, GDP growth, and policy rates vary substantially within and across bank types and have a sizable causal effect on credit supply decisions. Decisions about loan issuance and pricing exhibit large heterogeneity based on loan officers’ subjective expectations ...
Janet Gao, Georgetown Univeristy
Wednesday, May 14, 2025 | 2:00pm-3:30pm | Room 339
More Details
The Origin of Risk
We propose a model in which risk, at both the micro and the macro levels, is endogenous. In the model, each firm can choose the mean and the variance of its productivity process, as well as how it covaries with the productivity of other firms. To study the aggregate impact of these decisions, we embed the firms into an otherwise standard production network economy. Through their impact on risk-taking ...
Mathieu Taschereau-Dumouchel, Cornell University
Wednesday, May 14, 2025 | 9:30am-11:00am | Room 337
More Details
When Consumers Prefer Labor (vs. Material) Cost Justifications for Price Increases
Sometimes, firms justify price increases by citing an increase in their material costs; at other times, they justify the increases by citing an increase in their labor costs. Which justification – material or labor costs – is preferred by consumers? Previous theories suggest that material cost justifications are preferred because material costs tend to be more aligned, transient, and uncontrollable....
Rajesh Bagchi, "Virginia Polytechnic Institute and State University"
Wednesday, April 23, 2025 | 10:30am-12:00pm | Room 335
More Details
Extracting Extrapolative Beliefs from Market Prices: An Augmented Present-Value Approach
We propose a latent-variables approach to recover extrapolative beliefs from asset prices. We estimate a present-value model of the price–dividend ratio of the market that embeds both return extrapolation and cash-flow extrapolation, alongside discount rates and rational expectations of dividend growth. This approach allows us to measure extrapolation bias without having to rely on survey data, and ...
Yan Liu, Tsinghua University
Wednesday, April 23, 2025 | 10:30am-12:00pm | Room 339
More Details
Optimal Income Redistribution
We study whether a redesign of the social security and income tax-and-transfer systems can deliver significant welfare gains. Our rich quantitative model features both realistic inequality over the life-cycle and the key main channels through which redistributive policies can distort aggregate allocations. We find that there are two distinct ways to achieve significant welfare gains with joint policy ...
Arpad Abraham, University of Bristol
Wednesday, April 23, 2025 | 2:00pm-3:30pm | Room 337
More Details
Synthetic Media and AI Governance: Mapping the Risks and Responses to Misinformation in the LLM Era
The generative power of large language models (LLMs) is reshaping the information ecosystem, enabling not only enhanced communication but also the production of misinformation at scale. This talk examines emerging patterns in AI-generated misinformation, its diffusion across platforms, and the communicative risks it poses to public trust, epistemic stability, and information integrity. Drawing on recent ...
Celine Yunya Song, HKUST
Wednesday, April 16, 2025 | 2:00pm-3:30pm | Room 333
More Details
From Click to Boom: The Political Economy of E-Commerce in China
In merely two decades, China has transformed from a digital newcomer to the world’s largest e-commerce market, with 800 million users and nearly 50% of global retail sales. In From Click to Boom, Lizhi Liu examines how China’s e-commerce boom is inherently "paradoxical," why it addresses a core political economy question of institutional development, and how it illuminates a digital development path ...
Lizhi Liu, Georgetown Univeristy
Wednesday, April 16, 2025 | 2:00pm-3:30pm | Room 335
More Details
Corporate Taxation, Investment Frictions, and Macroeconomic Dynamics
We study how corporate tax reforms affect aggregate capital fluctuations in a general equilibrium dynamic investment model with firm heterogeneity, capital adjustment costs, and irreversibility wedges. We show that corporate tax changes influence capital misallocation and the propagation of aggregate shocks across tax regimes. Using microdata, we quantify these effects through after-tax investment ...
Isaac Baley, Universitat Pompeu Fabra
Wednesday, April 16, 2025 | 2:00pm-3:30pm | Room 337
More Details
