Abstract:
There are markedly different views on the rise of the sustainable investment movement. Some commentators argue that it is just window dressing. Others believe that it is having a real impact on corporate sustainability. This paper seeks to determine how changes in the responsible investor base affects corporate green capital expenditures. I identify responsible investors via the Climate Action 100+ initiative and approximate green capital expenditures with green debt instruments. The proportion of institutional investors with sustainable preferences is higher in Europe and Asia than in the United States. I exploit this observation and use the cross-listing of European and Asian headquartered firms in the United States as a negative responsible ownership shock. In a staggered difference-in-differences estimation, I find that cross-listing firms have a lower responsible investor share and are less likely to undertake green capital expenditures post cross-listing. I also document that responsible institutional investors engage more with management and are associated with stricter green governance. Together, my findings suggest that responsible institutional investors foster greater green capital expenditures by exerting influence on management.
with P. Bolton and M. Kacperczyk
Abstract:
We split green innovation into pure green and fuel efficiency patent filings and study its effects on carbon emissions in a large sample of global firms. Despite a steady rise in green R&D, we find that green innovation does not predict future reductions in emissions of innovating firms. Fuel efficiency innovation improves emission intensity but is also associated with higher future sales and investments, resulting in higher future emissions. At the industry level, countervailing effects in terms of emission intensity improvements and changing market shares of innovators on net result in green (fuel efficiency) innovation predicting higher (lower) future emissions.
Supplementary material: Patent Classification Description; Patent Classification List
with C. Custodio and D. Cvijanovic
Abstract:
This study investigates the impact of opioid abuse on real estate prices using variation in opioid prescription rates induced by the staggered passage of opioid-limiting legislation. Employing difference-in-differences, instrumental variables, and regression discontinuity design, we find that effective anti-opioid legislation results in an increase in county-level house prices due to a decrease in mortgage delinquencies and vacancy rates, and an increase in home improvement loans and migration inflows. Our results support a model of residential sorting that explains observed migration patterns following opioid-induced shocks to household income, highlighting the need for policy interventions to address the opioid epidemic's economic costs.
Media: IBKnowledge
with D. Cvijanovic and A. Wu
Abstract:
We investigate the relationship between childhood mental health conditions and financial outcomes later in life. We find that individuals with childhood mental health conditions are significantly less likely to hold any assets, accumulate fewer total assets both unconditionally and conditionally on asset ownership, and are less likely to be homeowners over the life cycle. They also tend to accumulate more debt, and in particular more non-mortgage debt. These results are largely driven by white and male demographic groups. Financial literacy mitigates most of these effects. Childhood mental health is also linked to a lower likelihood of overconfidence, shorter life span expectancy and financial planning horizons, more pessimistic economic outlook, and reduced cognitive abilities, all of which may jointly explain the observed differences in financial outcomes.
2024: AFA, Adam Smith Sustainability Conference, GRASFI, Entrepreneurship and Innovation Symposium NOVA
2023: UBC Winter Finance Conference, SSE Harnessing Finance for Climate*, Carey Finance Conference PhD Session, Hoyt Institute*
2022: CEPR Advanced Forum for Financial Economics (CAFFE)*, UBC Sauder Business School*, University of Southern California*, Bocconi University*, Stanford Institute for Theoretical Economics*, ECB Conference on Money Markets*
2021: AREUEA 2021 National Conference, MIT CRE Seminar Series*, Baruch College*, Ted Rodgers School of Business Management - Ryerson*
2020: UZH Young Researcher Workshop on Climate Finance, University of Reading*
2019: GRASFI PhD Workshop; University of Siegen Conference on Risk Governance and Sustainability
*: conference presentation by co-author