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Working papers

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

(Accepted at the 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.

Household Finance under the Shadow of Cancer (job market paper, new draft coming soon) 

I study the causal effects of life expectancy on financial, economic, and demographic decisions. My sample consists of individuals who undergo genetic testing for a hereditary cancer syndrome. Genetic testing randomizes tested persons into two groups. Those who test positive learn that they face a high risk of cancer and a shorter life expectancy. Those who test negative learn that their cancer risk is similar to that of the general population. The differences in outcomes between these two groups identify the effects of life expectancy. I find that life expectancy has a positive effect on wealth accumulation. Lower savings rates, safer portfolios, decreased labor supply, and different preferences for household composition explain lower wealth accumulation under reduced life expectancy.

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 ⋅ European Health Economics Association PhD Conference ⋅ Danmarks Nationalbank ⋅ Stockholm School of Economics ⋅ Goethe University Frankfurt ⋅  University of Groningen ⋅ Tilburg University 

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 2023 ⋅ Spanish Finance Forum ⋅ Tilburg University ⋅ ODISSEI/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