Hello!

About me

I am a research professional in financial economics with particular interest in questions of corporate finance and industrial organization and a methodological focus on accurate and robust statistical hypothesis testing.

I have received training at HEC Lausanne, the Swiss Finance Institute, the Study Center Gerzensee and several other institutions and I have myself taught exercise sessions in corporate finance, programming and optimization in business and economics on a Master of Science (MSc) level.

In the course of my education and career I have developed skills in working independently and driven by myself as well as to progress large projects in close cooperation within a team.

In my spare time I enjoy a good trip in the outdoors, a challenging route at the boulder gym or an intricate board game with friends and family.

Research

Working papers

Do Tests of the Common Ownership Hypothesis Mean What They Say? [Version February 17, 2023]

Empirical tests of the common ownership hypothesis typically assume that firms' incentives to soften competition are distributed evenly within an industry. In the data, however, common ownership is concentrated in large firms included in stock indexes, implying that previous tests of the hypothesis may suffer from considerable bias if a subset of firms continues to compete aggressively. I propose a theoretical model and a calibration method to simulate cross-sections of industries that are realistic in terms of industry composition, firm profitability and ownership structure. Using these simulated data, I find that the empirical tests suggested in three recent top tier papers can account for this heterogeneity under ideal conditions, but that all are prone to estimation bias if the data-generating process adopts additional features that are almost certainly present in real data. Taken together, and given the policy relevance of the issue, my results indicate the necessity for a rethinking of how tests of the common ownership hypothesis are conducted.

Common Owners as Active Monitors: A Theory of Rational Neglect [Version October 9, 2022]

I propose a novel mechanism of how common ownership affects product market competition. Internalization of shareholders' portfolio interests into managers' objective functions is no longer necessary if owners can provide active monitoring that affects firms' ability to compete. Whenever product market externalities cause common owners to neglect monitoring, firms are less competitive compared to a counterfactual where shareholder interests are aligned with firm value maximization. I formally prove this intuition in a static model of active monitoring with common ownership that allows for heterogeneous firms and portfolio allocations. Based on the game's unique Nash equilibrium, I derive empirical predictions that link unobserved active monitoring to observed product market outcomes. I conclude with a brief analysis of two policy interventions aimed at curbing the anti-competitive effects of common ownership.

The Hedging Effect of Low Durability Capital Assets in Competitive Industries [Version September 30, 2022]
with Thomas Dangl and Hamed Ghoddusi

We highlight the impact of physical capital durability on firms' investment behavior, output price dynamics, and industry equilibrium outcomes. In particular, we identify industry-wide depreciation of capital assets as a hedge against long-lasting episodes of overcapacity, and document that the equilibrium firm value might be negatively associated with capital durability. In particular, low demand elasticity increases the hedging effect of capital depreciation. In a dynamic model of equilibrium investment under uncertainty we develop endogenous output-price dynamics and closed-form solutions for optimal investment policies, firm value, as well as for the steady-state distribution of output prices. From this model we derive a set of testable predictions on expected equilibrium output prices, entry dynamics and the above mentioned hedging effect of low capital durability. We document broad empirical support for these predictions in a large sample of U.S. manufacturing firms.

Work in progress

Are termination fees innocuous?
with Theodosios Dimopoulos

Extant theoretical work argues that termination fees in M&As maintain ex-post allocative efficiency, while empirical work rejects the hypothesis that these fees are put in place to protect sweetheart deals of target management. We construct a structural model of sequential entry in M&As in which first stage bidding is followed by potential bidding competition. The model shows the possibility of allocative inefficiency and excessive preemption resulting from termination fees. Our calibration shows that existing empirical tests fail to detect the efficiency loss due to termination fees despite the fact that i) takeover premiums are increasing in termination fees and ii) the likelihood of rival bidder entry only mildly declines with termination fees.

Beyond the Deal: M&A Financing and Rival Ownership

Abstract to be announced.