PEER-REVIEWED PUBLICATIONS
Does Financial Innovation Lead to Real Innovation? Evidence from Financial Derivatives (with S. Eswar), Research Policy, Forthcoming.
Abstract: We investigate whether financial innovation, specifically the use of foreign exchange (FX) derivative products, spurs firms’ technological innovation, measured with patent-based metrics. Using a quasi-exogenous shock that reduces the cost of using FX derivatives and varying FX equity exposure of firms, we find that increased utilization of FX derivatives results in higher patent production. The primary mechanism driving this relationship is the reduction in financial constraints and enhanced risk management. The effect is especially pronounced for firms facing difficulties in raising equity capital. Our results indicate that the use of FX derivatives boosts innovative output by improving firms’ ability to raise equity capital, thereby increasing R&D investment, rather than by increasing risk-taking.
Capital Gains Tax, Venture Capital and Innovation in Start-ups (with S. Eswar), Review of Finance, 2022, 1-49.
Abstract: We examine the effect of staggered changes in state-level capital gains tax rates on Venture Capital (VC)-backed start-ups and show that an increase in tax rates reduces patent quantity and quality. The results are consistent with a reduction in VC incentives to provide effort: VC-level tax increases lead to incrementally lower patent production by start-ups not linked by a direct flight to the VC investor. VCs also influence and decrease the level of risk-taking in start-ups, and decrease the likelihood of the start-ups going public. We also find evidence of a change in entrepreneurs' incentives: after a tax decrease, entrepreneurs increase innovation risk.
Shortlisted: The 2024 Review of Finance “Pagano - Zechner Award”
Perverse Incentives of Special Purpose Acquisition Companies, the "Poor Man's Private Equity Funds", Journal of Accounting and Economics, 63 (1), 2017, 99-120.
Press Coverage: Private Equity Findings, U.K..
Press Coverage: FD Magazine, the Netherlands.
Family Control and Dilution in Mergers (with N. Basu and I. Paeglis), Journal of Banking and Finance, 33 (5), 2009, 829-841.
NON-PEER REVIEWED PUBLICATIONS
Special Purpose Acquisition Companies (with M. Fong), Forthcoming In: Cumming, D., Hammer, B. (eds) The Palgrave Encyclopedia of Private Equity. Palgrave Macmillan, Cham. 2023.
WORKING PAPERS
Executive Visibility: A Worthwhile Investment or a Futile Pursuit? (with M. Fong).
Abstract: We introduce a novel index of executive visibility and show its critical role in attracting retail investors to Special Purpose Acquisition Companies (SPACs). SPACs led by visible executives raise more capital, secure targets more quickly, and generate stronger investor interest at merger announcements - despite not delivering superior performance. Retail investors trade on visibility, and this relationship is intensified by social media, prior institutional trading, retail attention, and the GameStop saga. These effects cannot be explained by executive experience, general SPAC or target popularity, or celebrity endorsements, highlighting the unique influence of executive visibility on retail investors. This paper underscores the role of social networks in shaping retail trading behavior in SPACs, a setting marked by persistent retail demand in spite of historically poor outcomes.
Press Coverage: Columbia Law School’s Blog on Corporations and the Capital Markets, U.S.A..
Geopolitics of Generative AI Investment: U.S. vs. China (with M. Cara and H. Jiang).
Abstract: We study how OpenAI’s November 2022 release of ChatGPT reshaped corporate venture capital (CVC) in generative AI (GenAI). Using Crunchbase data, GenAI funding rose from $102M in 2018 to $28B by mid-2024. ChatGPT acted as a catalyst: CVCs shifted capital toward GenAI and favored first-time bets despite an overall venture slowdown. Chinese CVCs accelerated faster than U.S. peers post-ChatGPT, narrowing the cross-country gap, while U.S. investors showed stronger follow-on commitment. Industry responses varied, with financial services, lending/investments, and software CVCs making the biggest post-ChatGPT pivot. Overall, CVCs play a growing, strategy-shaping role in the GenAI ecosystem.
Lobbying and FDA Drug Approval (with S. Eswar and J. Gonzalez-Uribe).
Strategic Acquisitions by Corporate Venture Capital Investors.
Coller Institute of Private Equity Runner-up PhD Prize.
Monitoring Effects in Acquisitions of Private Companies.
WORK IN PROGRESS
FinTech under COVID-19: A step forward or survival of the fittest? (with M.Cara and H. Jiang).
Corporate Venture Capital and Productivity in Pharmaceutical-Biotechnology Companies (with J. Gonzalez-Uribe).