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Forthcoming in AEJ: Macroeconomics: "Cross-Border Spillovers: How U.S. Monetary Conditions Affect M&As Around the World" by Katharina Bergant, Prachi Mishra, Raghuram Rajan, and Freddy Pinzon-Puerto.

To avoid competing with profitable products they already own, many pharmaceutical companies keep R&D in-house, retaining control of product development that outsourcing cannot guarantee, say researchers at Cornell and @umassamherst.bsky.social. #econsky www.aeaweb.org/research/org...

When Canadian universities unionized, it raised faculty salaries and compressed their distribution by lifting the lowest salaries, say researchers at @utoronto.ca, @ucberkeleyofficial.bsky.social, and @memorialu.bsky.social. #econsky www.aeaweb.org/research/cha...

(Forthcoming Article) - In many markets the interaction between individuals and competing firms is mediated by a strategic platform. A defining feature of modern platforms is their extensive ability to control interactions. To understand such markets, I incorporate within-side externalities into a general mechanism-design model of many-to-many matching in two-sided markets. I characterize platform-optimal mechanisms and establish comparative statics. I analyze the implications and welfare effects of changes in market structure, including vertical integration by the platform and changes in the platform's information about firms. I then extend the canonical Dixit-Stiglitz model of monopolistic competition by giving the platform control over consideration sets.

(Forthcoming Article) - We study how U.S. monetary policy shocks transmit to cross-border merger and acquisition (M&A) activity. Using country- and firmlevel data, tighter U.S. policy is shown to reduce both the value and the number of cross-border deals. The effects are especially pronounced for acquirer firms with larger foreign-currency liabilities, consistent with a net worth channel. Reflecting agency motives for acquisitions, deals announced under more accommodative U.S. conditions underperform ex post, indicating potential capital misallocation.

(Forthcoming Article) - This paper shows that health insurers’ decisions to include providers in their networks are influenced by a previously underappreciated source of cost savings: network administrative costs. These costs counteract insurers’ incentives to offer narrow networks, which in standard models arise from risk selection and negotiated prices. Using a structural model of insurer competition over network breadth applied to Colombia, I find that insurers engage in risk selection by excluding providers in services used by unprofitable patients, but that heterogeneity in administrative costs leads some insurers to offer broader networks. Results inform the design of risk adjustment and network adequacy policies.

(Forthcoming Article) - This paper shows that effective reskilling substantially reduces antidepressant use among injured workers and their partners. Exploiting institutional variation in access to higher education following work accidents in Denmark, we find that reskilling prevents antidepressant use for one in three participants, with partner spillovers of comparable magnitude. These effects emerge while workers are in school—prior to any income gains—and coincide with increased partner employment. Assuming a one-to-one mapping between prescriptions and depressive episodes, the value of these health improvements adds 50% to the direct labor earnings gains from reskilling; partner earnings gains add another 33%.

(Forthcoming Article) - A slowdown in population growth reduces business dynamism by increasing the share of older firms. We explore how this affects productivity growth using a business dynamics model with endogenous productivity. The growth rate of older firms is a key factor in determining the impact of population growth on productivity. Quantitatively, this effect is substantial for both the U.S. and Japan. In the U.S., slowing population growth reduces TFP growth by 0.3 percentage points from 1970 to 2060, with an even larger effect in Japan. However, TFP growth reacts slowly due to short-run counterbalancing factors.

(Forthcoming Article) - Individuals form inflation expectations based on their demographics and locations. Different demographic groups respond differently to sectoral price changes, which we exploit to identify the inflationary impact of expectations. Our shift-share instrument combines national expectations of demographic groups with these groups’ regional population shares. A one-percentage-point rise in expected inflation increases regional inflation by 60 basis points. Long-run expectations (5–10 years) have negligible effects. The estimates are most robust for younger, married individuals with at least a high school diploma, whose expectations mainly influence non-durable goods prices.

(Forthcoming Article) - We study a principal who allocates a good to agents with private, independently distributed values through an optimal mechanism. The principal can strategically shape these value distributions by modifying the good’s features, which affect agents’ valuations. Our analysis reveals that optimal designs are frequently divisive – creating goods that appeal strongly to specific agents or agent types while being less valued by others. These divisive designs reduce information rents and increase total surplus, even though they reduce competition. Even when total surplus is constrained, some divisiveness in designs remains optimal.

(Forthcoming Article) - We study the relationship between corporate income taxation and carbon dioxide (CO2) emissions in the U.S. We show that CO2-intensive firms benefit more from the tax advantage of debt, and pay lower income taxes on their capital income. Building on these new facts, we provide evidence that a cut in the corporate income tax rate leads to a larger expansion of clean firms. We develop a multi-sector general equilibrium model that accounts for our evidence and quantify the impact of corporate tax reforms on aggregate emissions. A policy that eliminates the tax advantage of debt could reduce aggregate emissions without affecting GDP.