Publications

June 2014
Article

Frictions in Shadow Banking: Evidence from the Lending Behavior of Money Market Funds

By: Sergey Chernenko and Adi Sunderam

We document the consequences of money market fund risk taking during the European sovereign debt crisis. Using a novel data set of security-level holdings of prime money market funds, we show that funds with large exposures to risky Eurozone banks suffered significant... View Details

Keywords: Money Market Mutual Funds; European Sovereign Debt Crisis; Runs; Contagion; Risk Taking; Investment Funds; Financial Crisis; Europe

2014
Article

The Growth and Limits of Arbitrage: Evidence from Short Interest

By: Samuel G. Hanson and Adi Sunderam

We develop a novel methodology to infer the amount of capital allocated to quantitative equity arbitrage strategies. Using this methodology, which exploits time-variation in the cross section of short interest, we document that the amount of capital devoted to value... View Details

Keywords: Strategy; Financial Instruments; Capital Markets; Investment

June 2013
Article

Are There Too Many Safe Securities? Securitization and the Incentives for Information Production

By: Samuel G. Hanson and Adi Sunderam

We present a model that helps explain several past collapses of securitization markets. Originators issue too many informationally insensitive securities in good times, blunting investor incentives to become informed. The resulting endogenous scarcity of informed... View Details

Keywords: Information; Debt Securities; Financial Crisis

July 2012
Article

The Real Consequences of Market Segmentation

By: Sergey Chernenko and Adi Sunderam

We study the real effects of market segmentation due to credit ratings using a matched sample of firms just above and just below the investment-grade cutoff. These firms have similar observables, including average investment rates. However, flows into high-yield mutual... View Details

Keywords: Segmentation; Credit; Investment; Investment Funds; Quality; Markets; Measurement and Metrics; Business Ventures

Forthcoming
Article

When Should Public Programs Be Privately Administered? Theory and Evidence from the Paycheck Protection Program

By: Alexander W. Bartik, Zoë Cullen, Edward L. Glaeser, Michael Luca, Christopher Stanton and Adi Sunderam

What happens when public resources are allocated by private companies whose objectives may be imperfectly aligned with policy goals? We study this question in the context of the Paycheck Protection Program (PPP), which relied on private banks to disburse aid to small... View Details

Keywords: Paycheck Protection Program; Targeting; Impact; Entrepreneurship; Health Pandemics; Small Business; Financing and Loans; Outcome or Result; United States

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