Welcome! I am a fifth-year Ph.D. candidate in the Department of Economics at Columbia University. My research interests are banking, applied corporate finance, and financial regulation. My personal website is here.
I will join the National School of Development (NSD) at Peking University in China as an assistant professor in July 2019.
Barbara and David Zalaznick Professor of Business and Professor of Economics
Charles and Lynn Zhang Professor of Economics
John R. Eckel Jr. Professor of Financial Economics
Ph.D. Candidate, Department of Economics, Columbia University, 2014-2019 (expected)
B.A., School of Economics and Management, Tsinghua University, 2014
Exchange Student, The Wharton School, University of Pennsylvania, Fall 2012
Why do we have shadow banks and what is the optimal shadow bank regulation? I develop a bank run model featuring the tradeoff between financial innovation and systemic risk to investigate the role of shadow banking and the regulation. In my model, the traditional banking sector is regulated such that it can credibly provide safe assets, while a shadow banking sector creates space for beneficial investment opportunities created by financial innovation but also provides regulatory arbitrage opportunities for non-innovative banks. Systemic risk arises from the negative externalities of asset liquidation in the shadow banking sector, which may lead to a self-fulfilling recession and costly government bailouts. Heavy regulatory punishment on systemically important shadow banks controls existing systemic risk and has a deterrent effect on its accumulation ex ante. My paper is the first to formalize the designation authority of a macro-prudential regulator in systemic risk regulation.
Work in Progress
To Float or Not to Float? A Model of Money Market Fund Reform.
Abstract: Money market funds compete with commercial banks by issuing demandable shares with stable redemption price, transforming risky assets into money-like claims outside the traditional banking sector. In a coordination game model a la Angeletos and Werning (2006), I show that the floating net asset value, which allows investors to redeem shares at market-based price rather than book value, may lead to more self-fulfilling runs. Compared to stable net asset value, which becomes informative only when the regime is abandoned, the floating net asset value acts as a public noisy signal, coordinating investors’ behaviors and resulting in multiplicity. The destabilizing effect increases when investors’ capacity of acquiring private information is constrained. The model implications are consistent with a surge in the conversion from prime to government institutional funds in 2016 when the floating net asset value requirement on the former is the centerpiece of the money market fund reform.
Bank Liability Structure and Optimal Deposit Insurance.
Abstract: While the moral hazard problem brought by deposit insurance weakens market discipline, I show that the opposite can be true when the insurance stabilizes uninformed funding and increases the benefits of monitoring through information acquisition. Knowing the bank asset type, informed depositors utilize the demand deposits as a monitoring device and discipline the bank into holding good assets. However, self-fulfilling bank runs initiated by uninformed depositors erodes the future returns, inducing more depositors to forgo information acquisition and act like uninformed depositors. A novel role of deposit insurance emerges from the strategic complementarity between monitoring efforts and stability of uninformed funding. A capped deposit insurance, by stabilizing the retail funding of the bank, restores wholesale depositors’ monitoring incentives and benefits market discipline.
International Journal of Central Banking
GU4860: Behavioral Finance, TA for Professor Harrison Hong, Spring 2018
UN3025: Financial Economics, TA for Professor Sally Davidson, Spring 2016
UN3213: Intermediate Macroeconomics
- Head TA for Professor Xavier Sala-i-Martin, Fall 2016, Fall 2017
- TA for Professor Irasema Alonso, Spring 2017
UN1105: Principles of Economics,
- Instructor, Summer 2017
- TA for Professor Sunil Gulati, Fall 2015
Principles of Economics, TA for Professors Yingyi Qian and Xiaohan Zhong, 2013-2014
Critical Thinking and Moral Reasoning, TA for Professor Bin Yang, Fall 2013