ABOUT ME

Publications

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I am an Assistant Professor of Finance at the Gatton College of Business and Economics at the University of Kentucky. My research spans two areas of finance: entrepreneurship and asset management. A unifying theme across my work is the identification of issues that calls for the action of policymakers in order to improve the conditions of the less empowered.

Prior to joining UK. I recived a Ph.D in Finance from UC Berkeley, a MS in Economics from the University of São Paulo, and a B.S. in Mathematics from the University of São Paulo .

CV: [PDF]

Forthcoming, Review of Financial Studies

Public pension boards fear stakeholder outrage if they were to compensate internal investment managers with market-level salaries. We derive implications theoretically in an agency-portfolio choice model motivated by inequality-aversion. In a global sample, relaxing the effect of outrage on contracting leads to an average annual incremental value-add of $49 million generated through 11 bps in higher excess returns from risky assets, at the cost of $302,429 in additional compensation. Governance reforms that address outrage by reducing political appointees or requiring independent skills-based boards can increase the annual value-add. These findings are orthogonal to costly political distortions from underfunding and pay-to-play schemes. 

Working Papers

Gender Gap in Corporate Reorganizations

with Vinicius Augusto Brunassi Silva

We study how gender affects renegotiation with creditors. Using reorganization filings in the state of São Paulo in Brazil, we document that female-led debtors are 9 percentage points less likely to have their reorganization plans approved by creditors. The gender gap widens to 32 percentage points for high-loss debtors. This effect is not driven by differences in liquidation values or reorganization contracts. Using claim-level voting data, we show that the gender gap can be entirely attributed to male creditors. In line with a gender-based double standard for plan approval, female-led debtors have higher survival rates and higher return on assets after reorganization. Our findings are consistent with male creditors overextrapolating past losses of female-led debtors.

Under review

This paper provides a comprehensive analysis of portfolios of active mutual funds and ETFs. We find that here are almost no high-BM funds while there are many low-BM “growth” funds. Most “value” funds hold a higher proportion of their portfolios in low-BM (“growth”) stocks than in high-BM (“value”) stocks. The bias towards “growth” is present in other price-multiples and is stable across the sample. Moreover, most “value”/ “growth” indices are based on combinations of price multiples and fundamental growth rates and do not resemble “value”/ “growth” portfolios that are typically studied in academic research.

We study how politicians’ compensation affects the real economy. Specifically, we investigate the effect of legislators’ wages on business activity in Brazil. We identify our results using a constitutional amendment that established salary caps for legislators in a given municipality based on arbitrary population cutoffs. Higher politician wages are associated with increases in firm and job creation and firms’ average startup investments. Better paid legislators bring more resources to the municipality and increase expenditure on items that increase local economic productivity. Our evidence highlights the potential adverse effects on the private sector of lowering politicians’ salaries.

Can regions with prevalent violent and property crimes promote business by reducing crime rates through law enforcement? Using exogenous state-level police strikes in Brazil, I show that a short-term decrease in the police force leads to an increase in crime rates and a reduction in business activity. Taken together with the finding of the crime literature that lower business activity leads to more crimes, this implies a feedback loop between crime and business, suggesting the existence of multiple Pareto-ranked equilibria. I use the introduction of a law enforcement program called the Pacifying Police Units in the Rio de Janeiro city to provide evidence that a substantial (yet temporary) police shock can create a persistent reduction in crime and a persistent increase in entrepreneurship, consistent with a shift away from the undesirable high-crime low-business equilibrium.