Abstract: My paper sheds light on the complexity of liquidity injection programs by providing evidence on unintended consequences that arise when governments and central banks do not consider firm heterogeneity. Utilizing hand-collected, firm-level data from the Paycheck Protection Program, I show that government lending effectively reduced closures (the ultimate result of a liquidity shortfall), especially when received during the first two weeks of the program. However, I find that there was significant heterogeneity in the effectiveness of funds, resulting from the government’s broad-brush eligibility guidelines and differences in how firms process policy information. The implementation heavily relied on the banking system, which exacerbated the distributional effects by favoring firms with stronger customer capital. Overall, the paper highlights the importance of the design of liquidity distribution to maximize its benefits.
Summary: https://youtu.be/qNTaQbeshqY
Abstract: In this paper, I quantify the extent to which financial constraints limit the scope of activity of small firms, influence their labor decisions, and impact their ultimate survival. Using the U.S. branching deregulation from the 1990s, I document that local markets within deregulated states experienced an increase in their number of branches, driven by the entry of larger out-of-state banks and a decrease in the number of branches of existing local banks. As a result, small businesses were affected disproportionally. On average, in the treated markets, the overall lending to small businesses initially declined by 5.4% and remained lower for several years. The decline in credit supply eventually led to a decrease in the number of small businesses; however, many firms were able to stay in operation by decreasing their demand for labor. Specifically, there was an immediate decline in the employment and hours worked at small firms in newly deregulated markets, and even as small business lending recovered, these levels remained depressed for many years after that. Overall, the results demonstrate the critical dependence of small businesses on relationship lending by local banks and show how temporary negative credit supply shocks can have persistent adverse effects on labor.
Abstract: The lack of female CEOs and the persistent gender pay gap, especially at higher income levels, have become popular topics both in academics and society. Most studies focus on the differences between males and females that perpetuate this ``glass ceiling," while few look at within-gender traits that can help mitigate its effects. In this paper, I use novel measures of CEO and CFO vocal masculinity and language complexity to gain insight into how these individual-level traits influence executive status and compensation both within and across genders. I find that vocal masculinity, within females, positively impacts their likelihood of becoming a CEO while the opposite is true for males. When it comes to communication, CEOs speak with greater complexity than CFOs while both female CEOs and CFOs use more complex language and speak longer during earnings calls than their male counterparts. Differences in CEO-CFO language complexity are greater at low entrenchment firms while differences in masculinity are greater at high entrenchment firms. Additionally, while boards with greater female representation hire more female CEOs, they surprisingly seem to place a greater emphasis on female masculinity, while male masculinity plays a larger role at firms with male-dominated boards. Finally, for both male and female CEOs, compensation is positively related to masculinity, while increased language complexity only matters for females. These results help provide insight into the determinants of CEO status and compensation and may help explain how boards view and reward perceived competency across genders.