Welcome! I am a Ph.D. candidate in economics at Columbia University. My research focuses on macroeconomics and international finance.
I am on the job market this fall and will be available for interviews at the 2019 CICE China Job Market in Beijing, the 2019 EEA Job Market in Rotterdam and 2020 ASSA Meetings in San Diego.
Why do emerging market economies hold high levels of foreign exchange reserves? What is the optimal level of reserves, and do economies accumulate reserves in excess of this optimal level? I argue that foreign exchange reserves help emerging markets attract foreign direct investment. This incentive can play an important role when analyzing central banks’ reserve accumulation. I study the interaction between foreign exchange reserves and foreign direct investment to explain the level of reserves using a small open economy model. The model puts the domestic entities and international investors in the same picture. The optimal level of the reserve-to-GDP ratio generated by the model is close to the level observed in East Asian economies. Additionally, the model generates positive co-movement between technology growth and the current account. This feature suggests that high technology growth corresponds to net capital outflow, because of the outflow of foreign exchange reserves in attracting the inflow of foreign direct investment, thus providing a rationale to the ‘allocation puzzle’ in cross-economy comparisons. The model also generates positive co-movement between foreign exchange reserves and foreign debt, thus relating to the puzzle of why economies borrow and save simultaneously.
Work in Progress:
Liability Dollarization and Contractionary Devaluation: A Model-Based Evaluation
Abstract: This paper explores how the devaluation of domestic currency imposes a contractionary effect on small open economies who have a significant amount of debt denominated in foreign currencies. Economists and policymakers express concern about the “Original Sin” situation in which most of the economies in the world cannot use their domestic currencies to borrow abroad. A devaluation will increase the foreign currency-denominated debt measured in the domestic currency, which will lead to contractions in the domestic economy. However, previous literature on currency denomination and exchange rate policy predicted limited or no contractionary effect of devaluation. In this paper, I present a new model to capture this contractionary devaluation effect with non-financial firms having foreign currency-denominated liabilities and domestic currency denominated assets. When firms borrow from abroad and keep part of the asset in domestic cash or cash equivalents, the contractionary devaluation effect is exacerbated. The model can be used to discuss the performance of the economy in interest under exchange rate shocks and interest rate shocks. Future directions for empirically assessing the model and current literature are suggested. This assessment will thus provide policy guidance for economies with different levels of debt, especially foreign currency-denominated debt.
Do FDI Firms Create More Jobs Than Domestic Firms for Each Dollar of Asset? (with Sakai Ando)
Abstract: This paper studies whether FDI firms hire more employees than domestic firms for each dollar of asset. Based on the firm-level data from Orbis, we show that, in most economies, domestic firms hire more employees per asset than FDI firms. The analysis of the industry composition suggests that domestic firms create more jobs per asset when a larger share of domestic firms are in construction, wholesale trade, and service industries. The analysis of switchers shows that domestic firms create fewer jobs per asset after switching the ownership to become FDI firms. These suggest the policy space for job creation is bigger for FDI firms.
Abstract: Cook (2004) presents a model with the financial accelerator mechanism to discuss the devaluation effect on small open economies with foreign currency-denominated external debt. The main conclusion in the paper is that upon an increase in the world interest rate, the monetary policy with an exchange rate peg is better for the economy than flexible exchange rate with inflation targeting, when comparing the magnitude of the decrease in output and investment after the shock. I find that the ranking of the two policies are reversed once certain parameter values are changed. I also perform welfare analysis and base on which discuss the ranking of different monetary policies, providing a method of quantifying the loss of monetary policies under shocks.
Globalization and its Risks, Spring 2018, TA for Professor Graciela Chichilnisky
Advanced Macroeconomics, Fall 2017, Fall 2016, TA for Professor Andres Drenik
Introduction to Econometrics, Spring 2017, TA for Professor Simon Lee
International Macroeconomics, Spring 2016, TA for Professor Stephanie Schmitt-Grohe
Intermediate Macroeconomics, Fall 2015, TA for Professor Danilo Guaitoli
