Short Bio & Research Activity
I am the Bernard T. Rocca Jr. Chair and Professor at the University of California, Berkeley Haas School of Business. I am also a Research Associate at the National Bureau of Economic Research (NBER), where I co-direct the NBER Political Economy Program (POL), and a Research Fellow of the Centre for Economic Policy Research (CEPR).
Before joining UC Berkeley, I was Canada Research Chair and Professor of Economics at the University of British Columbia Vancouver School of Economics and Assistant Professor of Economics at the University of Chicago Booth School of Business. I received my PhD in Economics from Harvard University in 2006.
My academic research focuses on Political Economy and Applied Microeconomics broadly defined. I have worked on political institutions and their design, elections and political campaigns, behavior in legislatures, campaign finance, lobbying, regulation, and banking. I have also worked on topics related to the political economy of development, corruption, patronage, ethnic politics, and intra-state conflict.
I have interests in Finance, Development Economics, and Macroeconomics. My primary teaching interests are in Political Economy, Applied Econometrics, Macroeconomics, and Data Science.
Recent Working Papers
The Cost of Regulatory Compliance in the United States (with Miao Ben Zhang)
We quantify the compliance costs of regulation in the U.S. for the period 2003-2014 in terms of labor input costs borne by establishments and firms. Detailed establishment-level occupation microdata, in combination with occupation-specific task information, allow us to recover the share of an establishment's wage bill that can be attributed to workers engaged in supervision and adherence to regulations, rules, government specifications, safety guidelines, and any other task associated with compliance. Since labor is the primary component of regulatory compliance spending for large portions of the U.S. economy, we are able to consistently trace the extent of the regulatory costs borne by producers across industries and regions. Regulatory costs account for 1.3 percent of the total wage bill on average. The paper also addresses the issue of returns to scale in regulatory compliance, showing that regulatory costs as a share of a firm wage bill decrease for firms above 430 employees, while increase below such threshold. Finally, we present a methodology for decoupling the role of firm-specific regulatory burden from the firm's endogenous compliance effort.
Minority Underrepresentation in U.S. Cities (with Federico Ricca)
This paper investigates the patterns of minority representation in U.S. municipal governments and of minority voter registration for the period 1981-2020. We report substantial levels of strategic underrepresentation of African American, Asian, and Latino voters in U.S. local politics. Disproportionality in the representation and in voter registration rates of minority groups are widespread, but stronger where racial or ethnic minorities are electorally pivotal. Underrepresentation is determined by the combination of several endogenous institutional features, starting from systematic disparity in voter registration, strategic selection of electoral rules, city's form of government, council size, and pay of elected members of the council. We provide causal evidence of the strategic use of local political institutions in reducing electoral representation of minorities based on the U.S. Supreme Court narrow decision of Shelby County v. Holder (2013), which removed Voting Rights Act (VRA) Section 4 coverage requirements for a specific subset of U.S. localities. In VRA-covered municipalities, changes to voting procedures required preclearance by the Department of Justice, a process designed to prevent racially discriminatory actions. Post 2013, previously VRA-covered municipalities quickly revert to levels of minority underrepresentation and underregistration identical to those of non-covered municipalities, reducing overall proportionality in minority representation and registration.
Investing in Influence: Investors, Portfolio Firms, and Political Giving (with Marianne Bertrand, Matilde Bombardini, Raymond Fisman, and Eyub Yegen)
Campaign finance laws aim to limit an individual’s influence over the political process. We show that corporate ownership may be an important mechanism by which institutional investors circumvent such constraints and increase their influence. Using data on the political giving and ownership of all 13-F investors during 1980-2018, we show the probability that a firm’s Political Action Committee (PAC) donates to a politician supported by an investor’s PAC nearly doubles after the investor acquires a large stake, and when an investor obtains a board seat, there is a five-fold increase in the probability that a firm donates to a politician supported by the investor. This increase in similarity of political giving coincides precisely with the acquisition election cycle, and is not driven by selection into specific politically strategic acquisitions, as convergence in political behavior is observed even for exogenously determined acquisitions caused by stock index inclusions. Further, we show that portfolio firms’ PAC expenditure experiences a relatively large shift at the acquisition date relative to past giving, whereas no such pattern is observed for institutional investors. We argue that these findings are best explained by investors influencing portfolio firm giving, suggesting that PAC giving may be another means by which influential shareholders impact corporate decision-making, in a manner that amplifies investors’ political voice.