I am a postdoctoral researcher at the Columbia Business School and Columbia Law School Program in the Law and Economics of Capital Markets. My research interests include empirical corporate finance and capital markets.
Contact: ac4498@columbia.edu
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Working Papers
The Accredited Investor Definition, Private Investments, and Wealth Inequality in the US
I study household finances around the income eligibility rules of the accredited investor definition that allow only high-income households access to private investments. Such investments have recently been linked to higher returns and the increase in wealth inequality. My analysis shows that access to private markets increases private investments. The result provides an answer to an important question in the literature and politics: differences in private investments are not only caused by differences in abilities and tastes between wealthy and poor households, but also simply by access to private investments. Moreover, I find discontinuities in wealth and returns. Eligible households exhibit relative increases in the private investments to assets ratio, net wealth, and returns by 6.2pp, 39%, and 1.0pp, respectively. A back-of-the-envelope calculation suggests that the accredited investor definition can explain important parts of recent increases in wealth inequality.
Empirical Evidence on Debt Governance
A large theoretical literature suggests that debt can mitigate agency problems, yet empirical evidence is limited due to identification problems. To provide evidence, I examine whether firms implement independent directors as a substitute when debt governance becomes ineffective. Key to my analysis are two central features of debt as a governance device: first, it is only effective with bankruptcy penalties, second, it only matters for firms close to default. Consistent with debt inducing discipline, across countries, board independence is negatively related to bankruptcy penalties, and especially so among risky firms. For them, a change from strictest to softest penalties is associated with a 46% increase in the number of independent directors. Comparing changes in board independence of risky firms to those of safe firms around bankruptcy reforms confirms the cross-country results. My findings underline the role of agency problems in explaining corporate capital structure, and can further account for several unresolved issues in corporate governance (e.g., differences in bankruptcy penalties can explain 37% of the 37 percentage point “board independence gap” between the US and the UK). Moreover, my findings have important implications for optimal bankruptcy design: in the absence of bankruptcy penalties, management may have difficulties to credibly commit to forgo inefficient actions and thus to secure financing.
Dual-Class Firms, Agency Problems, and Debt Governance: Evidence from Korea
I examine whether debt (or, more generally, a performance threshold) can reduce agency problems between controlling shareholders and minority shareholders in dual-class firms. To do so, I use two key features of debt governance. First, it is only effective with bankruptcy penalties, second, it only matters for firms close to default. I measure agency problems by the voting premium. Using a Korean bankruptcy reform that reduced penalties, I find that risky firms exhibited a 59% increase in the voting premium after the reform relative to safe firms. My findings have important implications for the heated debate on dual-class share structure.
Creditor Rights, Corporate Leverage and Investments, and the Firm Type
(with Axel Kind, Lubomir Litov, and Jiri Tresl)
Stronger creditor rights reduce credit costs and thus may allow firms to increase leverage and investments. Yet, they also increase distress costs and thus may prompt firms to lower leverage and undertake risk-reducing but unprofitable investments. Using a German bankruptcy reform, on average, we find evidence consistent with the latter hypothesis. We also hypothesize and find evidence that the effect of creditor rights on corporate leverage and investments depends on the firm type (particularly, firm size), as it influences the effect that creditor rights have on credit costs and distress costs and thus which effect dominates. Our understanding reconciles mixed empirical evidence and has important implications for optimal bankruptcy design. In particular, it points to a menu of procedures in which a debtor-friendly and creditor-friendly procedure co-exist and thus allow different types of firms to utilize the procedure that suits them best.
Conferences: AFFI 2018, ALEA 2019, CELSE 2018, COMPIE 2021, FMA 2018, IRMC 2020, JLFA 2018, Law and Macroeconomics Conference 2020
Nature-Related Risks in Syndicated Lending
(with Santanu Kundu, Jiri Tresl, and Lukas Zimmermann)
This study examines how nature-related risks are considered in syndicated lending, showing that firms highly dependent on ecosystem services (nature–dependent firms) incur higher financing costs. Using U.S. syndicated loan data and a novel nature dependency measure, we find a 1% rise in nature dependency results in a 0.32% increase in loan spreads. Leveraging the 2019 Endangered Species Act (ESA) amendment as an exogenous shock, we show regulatory relaxation lowered spreads for nature–dependent firms. Regulating ecosystem services – vital to environmental stability – exert the most influence on lending costs, suggesting that natural capital risks are increasingly internalized by financial markets. We also highlight the role of refinancing risk in how banks price nature dependency of borrowers.
Conferences: Aarhus Workshop on Strategic Interaction and Corporate Finance 2025 (scheduled), AEA 2025, AFA 2026 (scheduled), Conference on Biodiversity in Finance and Accounting 2025 (scheduled), GRASFI 2025 (scheduled)
Work in Progress
The New Special Study of the Securities Markets
(with Merritt Fox, Lawrence Glosten, and Edward Greene)
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