Decision Making & Negotiations

This paper provides quasi-experimental evidence on the impact of paid leave legislation on fathers' leave-taking, as well as on the division of leave between mothers and fathers in dual-earner households. Using difference-in-difference and difference-in-difference-in-difference designs, we study California's Paid Family Leave (CA-PFL) program, which is the first source of government-provided paid parental leave available to fathers in the United States.

Studies of how quantitative easing (QE) impacts asset prices typically look for effects in one- or two-day windows around QE announcements. This methodology underestimates the impact of QE on asset classes whose responses happen outside of this short time frame. We document that QE announcements by the Fed, ECB, and the Bank of England are associated with: quick price reactions of medium- and long-term government bonds; but with reactions in equity and equity implied volatility that occur over several weeks.

We propose new metrics for investment performance based on short-run trading profitability. Since investment opportunities are scarce and value-relevant information decays over time, marginal decisions made by fund managers (i.e., trades) should provide more accurate signals about underlying skill than portfolio alphas, which are contaminated by the returns on "stale" positions.

We study a multi-server queueing model of a revenue-maximizing firm providing a service to a market of heterogeneous price- and delay-sensitive customers with private individual preferences. The firm may offer a selection of service classes that are differentiated in prices and delays. Using a deterministic relaxation, which highlights the first-order economic structure of the problem, we construct a solution that is incentive compatible and near-optimal in systems with large capacity and market potential.

Consumer reviews and ratings of products and services have become ubiquitous on the Internet. This paper analyzes, given the sequential nature of reviews and the limited feedback of such past reviews, the information content they communicate to future customers. We consider a model with heterogeneous customers who buy a product of unknown quality and we focus on two different informational settings. In the first setting customers observe the whole history of past reviews. In the second one they only observe the sample mean of past reviews.

We study the relationship between capacity and performance for a service firm with spatial operations, in the sense that requests arrive with origin-destination pairs. An example of such a system is a ride-hailing platform in which each customer arrives in the system with the need to travel from an origin to a destination. We propose a state-dependent queueing model that captures spatial frictions as well as spatial economies of scale through the service rate.

Originators produce higher quality assets at a private cost. These assets can either be bought by informed intermediaries or sold in a pool with low quality assets. Savings gluts diminish origination incentives because they compress the spread between the price paid for high quality assets and the price paid for the pool. The narrowing of the spreads relaxes borrowing constraints, which results in higher leverage. Thus savings gluts generate financial fragility — the sensitivity of financial intermediaries' equity to unforeseen contingencies.