I am an Assistant Professor of Finance at the Erasmus School of Economics, Erasmus University Rotterdam. My research is centered around finance and health. I study how financial shocks affect households' and employees' health, and how health shocks impact household finances. I am also interested in the economics of family businesses.

Email: karpati (at) ese.eur.nl


Corporate Financing Frictions and Employee Mental Health (with Luc Renneboog)

Journal of Financial and Quantitative Analysis

This paper argues that corporate financial frictions can have an adverse effect on employee mental health, an important determinant of employee productivity. To identify the causal effects of financial frictions, we exploit variation in firms’ need to refinance their long-term debt in 2008, a period when refinancing became more difficult due to the credit crunch. Using administrative microdata, we find that antidepressant use grows significantly more among employees of firms in higher need of debt refinancing. Much of this effect occurs at employees keeping their jobs, pointing to decreased perceptions of job security as a transmission channel.

Working papers

Does Life Expectancy Affect Wealth Accumulation? Evidence from Genetic Testing
(previously circulated as: Household Finance under the Shadow of Cancer)

Life expectancy plays a key role in economic models of wealth accumulation, with important implications for economic growth. Empirically, the effects of life expectancy are hard to identify, since a lower life expectancy is typically correlated with bad current health. I overcome this challenge by exploiting genetic testing as an information shock to life expectancy. My sample consists of working-age adults who start their life with a 50% probability of having inherited a gene mutation causing Lynch syndrome (LS), a hereditary cancer syndrome. They undergo genetic testing to learn their mutation carrier status while they are still healthy. Conditional on the ex-ante probability of carrying the LS gene mutation, the result of genetic testing is independent of potential outcomes. To identify the causal effects of life expectancy, I estimate the differences in outcomes following genetic testing between people who test positive (mutation carriers) and those who test negative (non-carriers) using detailed administrative data. I find that life expectancy has a positive effect on financial wealth accumulation among working-age adults, in large part due to a positive effect on labor supply and household income. Other less-liquid wealth elements such as housing wealth are unaffected. Using a baseline of untested individuals, I also find that increases and decreases in life expectancy lead to opposite-signed effects on financial wealth accumulation.

Selected presentations:  EFA 2023  FIRS PhD session ⋅ Paris December Finance  ⋅ FMA ⋅ European Winter Meeting of the Econometric Society  ⋅ SAFE Household Finance Workshop⋅ Young Economist Symposium 2022 Yale ⋅ Annual Meeting of the German Finance Association 

Awards: Young Researchers Prize of the Asociación Libre de Economía (AldE) 2022, Finalist for the JFI/FIRS Ph.D. Student Paper Award 2022

The Economic Value of Eliminating Diseases (with Julio Crego, Jens Kvaerner and Luc Renneboog)

We estimate the causal effects of 334 different types of health shocks on medical expenses, mortality, disability, labor market participation, labor earnings, and the need for nursing home care using detailed data on 6.9 million people diagnosed by medical specialists between 2013 and 2017. We quantify the benefits of eliminating diseases with distinct consequences for people of different social strata by incorporating the estimates into a standard life-cycle model. Our results reveal substantial heterogeneity in welfare gains by types of disease for different people. We discuss the potential implications of our results for the financing of medical research. 

Presentations:  EEA 2023Spanish Finance Forum ⋅ Tilburg UniversityODISSEI/Statistics Netherlands

Review papers

The Family Firm A Synthesis, Stylized Facts, and Future Research Directions (with Jeroen Verbouw and Luc Renneboog)

In acknowledging and exploiting the substantial heterogeneity between family firms, scholars are increasingly stepping away from the dichotomization of family influence to better understand critical nuances that explain how, why, and when family firms differ from their nonfamily counterparts. For the sample of privately-held family firms, this study also pushes the literature further and argues that various sources of heterogeneity might be correlated and that not taking this into account sustains empirical indeterminacies and limits theoretical advancement. We, therefore, take on a family-level perspective and show how heterogeneous family values interact with more traditional factors that have received ample scholarly attention such as succession, firm strategies, ownership and governance, and financial policies. Specifically, we present an extensive synthesis of the recent and topical literature on each topic and then provide stylized facts on intercorrelations between sources of family firm heterogeneity based on survey data on over 900 family firms. Lastly, we delineate a detailed research agenda to push the field forward.

E-MAIl: karpati (at) ese.eur.nl
ADDRESS: Erasmus School of Economics, Erasmus University Rotterdam, Burgemeester Oudlaan 50, 3062 PA Rotterdam, the Netherlands