Bankruptcy Spillovers, with Shai Bernstein, Emanuele Colonnelli, and Xavier Giroud, Journal of Financial Economics, forthcoming
Asset Allocation in Bankruptcy, with Shai Bernstein and Emanuele Colonnelli, Journal of Finance, forthcoming
Get in Line: Chapter 11 Restructuring in Crowded Bankruptcy Courts, Management Science, forthcoming
The Ownership and Trading of Debt Claims in Chapter 11 Restructurings, with Victoria Ivashina and David Smith, Journal of Financial Economics 119, Issue 2 (February 2016): 316-335.
Subprime Foreclosures and the 2005 Bankruptcy Reform, with Donald Morgan and Matthew Botsch, Federal Reserve Bank of New York Economic Policy Review 18, No. 1 (March 2012): 47-57.
- Winner of Jensen Prize for Best Paper in Corporate Finance and Organizations (Second Prize)
Trade Creditors' Information Advantage, with Victoria Ivashina, January 2018.
Abstract: Using information on the sales of debt claims for 132 U.S. Chapter 11 bankruptcy cases, we show that large trade creditors’ decisions to sell receivables of a distressed company in bankruptcy are predictive of lower recovery rates, and that in such cases these creditors sell ahead of less informed suppliers and other creditors. This result is especially pronounced for more opaque distressed firms, when trade creditors’ information advantage is likely largest. This evidence shows that suppliers that extend significant amounts of trade credit hold private information about their trade partners. Trade creditors who are geographically closer or in similar industries tend to lend the most, suggesting that these are two channels through which suppliers hold an information advantage.
Can Gambling Increase Savings? Empircal Evidence on Prize-linked Savings Accounts, with Shawn Cole and Peter Tufano, September 2017.
Abstract: This paper studies the adoption and impact of prize-linked savings (PLS) accounts, which offer random, lottery-like payouts to individual account holders in lieu of interest. Using micro-level data from a bank offering these products in South Africa, we show that PLS is attractive to a broad group of individuals, across all age, race, and income levels. Financially constrained individuals and those with no existing deposit accounts are particularly likely to open a PLS account. Participants in the PLS program increase their total savings on average by 1% of annual income, a 38% increase from the mean level of savings. Deposits in PLS do not appear to cannibalize same-bank savings in standard savings products, on average. Instead, PLS serves as a substitute for lottery gambling. Exploiting the random assignment of prizes, we also present evidence that prize winners increase their investment in PLS, sometimes by more than the amount of the prize won, and that large prizes generate a local “buzz” that leads to an 11.6% increase in demand for PLS at a winning branch.
Practice Makes Perfect: Judge Experience and Bankruptcy Outcomes, with Josh Madsen, Wei Wang, and Qiping Xu, December 2017.
Abstract: Exploiting the within-district random assignment of bankruptcy cases to judges, we provide new evidence on the effects of judges' on-the-bench experience on large public corporate Chapter 11 outcomes. We find that cases assigned to more experienced judges spend less time in bankruptcy, are more likely to be reorganized rather than liquidated, but are not more likely to refile for bankruptcy after emergence. Our heterogeneity tests suggest that the effect of judge experience is stronger when the court is busy. In addition, we show that prior judgeship professional experience and personal attributes do not consistently explain case outcomes. Our evidence collectively highlights the importance of on-the-bench experience for judges and the impact of judge characteristics on large corporate bankruptcies.