Research

* denotes presentation by coauthor

Exploiting a shock drawing public attention to banks’ financial relationships with the gun industry, I find that banks that lend to the gun industry experience significant decreases in deposit growth. The effect is stronger in regions with more Democrats or higher support for gun control. Anti-gun depositor movements raise funding costs for gun-lending banks and thus reduce their lending business, which coincides with slower growth in gun business establishments. Moreover, I find evidence that banks with public anti-gun policies also experience reduced deposit growth, specifically in regions with more Republicans or higher support for gun rights.

Presented At: Chinese University of Hong Kong, European Finance Association Doctoral Tutorial, Midwest Finance Association, Eastern Finance Association, Asian Finance Association & Doctoral Symposium, Goizueta Doctoral Research Conference, Southwestern Finance Association, Joint Conference with the Allied Korea Finance Associations, Korea America Finance Association Brownbag Seminar, Financial Management Association, Emory University


Public mass shootings raise borrowing costs of issuers in affected counties by an average of six (five) basis points in the secondary (primary) market. This increase in tax-adjusted yield spreads is not driven by any material change in the issuers' fundamentals, nor by an increase in illiquidity, risk aversion, or excess supply of debt. In contrast, there is no evidence that the violent crime rate in the county is priced into yield spreads. A possible explanation is investors' biased expectations of fundamentals brought about by media-driven salience.

Presented At: Asian Bureau of Finance and Economic Research*, American Real Estate and Urban Economics Association International Conference*, Atlanta Young Scholar Symposium, Deakin University*, Emory University*, Monash University*, UT San Antonio*


We investigate how social connection affects municipal finance. Municipal Bond Mutual Funds allocate more capital to counties with stronger social connection, which in turn lowers the municipalities’ financing costs in the municipal bond market. Consistent with the familiarity-driven demand channel, the effects are focused on mutual funds with lower institutional resources and opaque bonds facing higher uncertainty; we find no effect for bank-qualified bonds, which mutual funds rarely hold. Fundamental risks, underwriter effects, and large counties with national-level awareness do not drive the results. Overall, we provide a new channel based on social connection that explains the cross-section of municipal bond prices.

Featured in The FinReg Blog sponsored by the Duke Financial Economics Center

Presented At: Goizueta Doctoral Research Conference*