Bridging the gap between migrants and the banking system

In this paper, we test whether micro firms run by migrants pay more for credit than firms run by natives and whether the differences in the cost of credit for these two groups of entrepreneurs decrease as the informational and cultural gaps narrow. We employ a large and unique data set providing us with detailed information on each overdraft loan granted by banks to sole proprietorships based in Italy. We find that migrants pay, on average, almost 70 basis points more for credit than natives. The interest rate differential is lower for entrepreneurs born in Italy whose parents were natives of other countries (“second generation” migrants) and for migrants whose parents were natives of Italy (“Italian migrants”). These results suggest that cultural differences may matter for the functioning of the credit market. A lengthening of credit history reduces the interest rate differential between the two types of entrepreneurs. Finally, we find that both increases in the size of the migrant community and improvements in banks’ ability to deal with cultural diversity help narrow the interest rate differential between migrant and Italian entrepreneurs.migration, bank lending, interest rates

Labor Mobility and Racial Discrimination

This paper assesses the impact of labor mobility on racial discrimination. We present an equilibrium search model that reveals an inverted U-shaped relationship between labor mobility and race-based wage differentials. We explore this relationship empirically with an exogenous mobility shock on the European soccer labor market. The Bosman ruling by the European Court of Justice in 1995 lifted restrictions on soccer player mobility. Using a panel of all clubs in the English first division from 1981 to 2008, we compare the pre- and post-Bosman ruling market to identify the causal effect of intensified mobility on race-based wage differentials. Consistent with a taste-based explanation, we find evidence that increasing labor market mobility decreases racial discrimination

'Recommended by Duncan Hines': Automobility, Authority, and American Gastronomy

How did Duncan Hines become an authority on roadside dining? What role did he have in the consumption of food and the use of automobiles? What were the messages he pronounced to his audiences? In "'Recommended by Duncan Hines,'" I examine the formation of Duncan Hines as the premier American restaurant critic as occurring in national journals and self-published guidebooks of the 1930s to 1950s. Analyzed as a function of the discursive production of power/knowledge within the historical contexts of cultures of automobility, consumption, and authority, I frame Hines as a mediator between producers and consumers, a position gaining in significance in the early 20th century. Narrating the exchange of commodities, Hines' gastronomy acted as a fount of nationalism and American "taste" based in perceptions of geography, history, and authenticity. Furthermore, my thesis presents a model for comprehending the origins, role, and effects of critics and other cultural authorities

The Price of Ethics: Evidence from Socially Responsible Mutual Funds

This paper estimates the price of ethics by studying the risk-return relation in socially responsible investment (SRI) funds. Consistent with investors paying a price for ethics, SRI funds in many European and Asia-Pacific countries strongly underperform domestic benchmark portfolios by about 5% per annum, although UK and US SRI funds do not significantly underperform their benchmarks. The underperformance of SRI funds does not seem to be driven by the loadings on an ethical risk factor. SRI funds do not suffer a cost of reduced selectivity nor do SRI funds managers time the market. There is mixed evidence of a smart money effect: SRI investors are unable to identify the funds that will outperform in the future, whereas they show some fund-selection ability in identifying ethical funds that will perform poorly. The screening activities of SRI funds have a significant impact on funds’ riskadjusted returns and loadings on risk factors: corporate governance and social screens generate better risk-adjusted returns whereas other screens (e.g. environmental ones) yield significantly lower returns.ethics;mutual funds;socially responsible investing;investment screens;smart money;risk loadings

Diasporas and Outsourcing: Evidence from oDesk and India

This study examines the role of the Indian diaspora in the outsourcing of work to India. Our data are taken from oDesk, the world's largest online platform for outsourced contracts, where India is the largest country in terms of contract volume. We use an ethnic name procedure to identify ethnic Indian users of oDesk in other countries around the world. We find very clear evidence that diaspora-based links matter on oDesk, with ethnic Indians in other countries 32% (9 percentage points) more likely to choose a worker in India. Yet, the size of the Indian diaspora on oDesk and the timing of its effects make clear that the Indian diaspora was not a very important factor in India becoming the leading country on oDesk for fulfilling work. In fact, multiple pieces of evidence suggest that diaspora use of oDesk increases with familiarity of the platform, rather than a scenario where diaspora connections serve to navigate uncertain environments. We further show that diaspora-based contracts mainly serve to lower costs for the company contacts outsourcing the work, as the workers in India are paid about the market wage for their work. These results and other observations lead to the conclusion that diaspora connections continue to be important even as online platforms provide many of the features that diaspora networks historically provided (e.g., information about potential workers, monitoring, and reputation foundations)

The Price of Ethics: Evidence from Socially Responsible Mutual Funds

This paper estimates the price of ethics by studying the risk-return relation in socially responsible investment (SRI) funds. Consistent with investors paying a price for ethics, SRI funds in many European and Asia-Pacific countries strongly underperform domestic benchmark portfolios by about 5% per annum, although UK and US SRI funds do not significantly underperform their benchmarks. The underperformance of SRI funds does not seem to be driven by the loadings on an ethical risk factor. SRI funds do not suffer a cost of reduced selectivity nor do SRI funds managers time the market. There is mixed evidence of a smart money effect: SRI investors are unable to identify the funds that will outperform in the future, whereas they show some fund-selection ability in identifying ethical funds that will perform poorly. The screening activities of SRI funds have a significant impact on funds’ riskadjusted returns and loadings on risk factors: corporate governance and social screens generate better risk-adjusted returns whereas other screens (e.g. environmental ones) yield significantly lower returns.ethics;mutual funds;socially responsible investing;investment screens;smart money;risk loadings

Gender and the Availability of Credit to Privately Held Firms: Evidence from the Surveys of Small Business Finances

We use data from the nationally representative Surveys of Small Business Finances to analyze differences by gender in the ownership of privately held U.S. firms, and to examine the role of gender in the availability of credit. We document a series of empirical regularities regarding male- and female-owned firms. Female-owned firms are smaller, younger, have fewer and shorter banking relationships, and are more likely to be credit constrained. Female owners are younger, less experienced, and not as well educated. Differences in credit outcomes are rendered insignificant in a multivariate setting, where we control for other firm and owner characteristics. Finally, we test the robustness of our findings by means of the propensity score matching method

UNDERSTANDING PERCEIVED PLATFORM TRUST AND INSTITUTIONAL RISK IN PEER-TO-PEER LENDING PLATFORMS FROM COGNITION-BASED AND AFFECT-BASED PERSPECTIVES

In this study, we drew from the existing online trust model to develop a specific model of online lending platform trust from the perspectives of cognition-based trust and affect-based trust. Trust between lenders and borrowers have been discussed a lot but there are no empirical studies focusing on trust toward lending platforms. The dearth of the relevant studies on this aspect indicates the great need for the present study. This study aims to incorporate the Technology Acceptance Model with additionally context-specific factors to propose a research model. Perceived platform trust is divided into three dimensions: technology expectancy, cognition-based trust and affected-based trust. To test the model, we collected data from 300 users with different educational levels on p2p lending platforms in China. The structure of demographic features of our samples is analogous to that of the overall p2p market in China at the end of 2012. The finding suggested that positive reputation and social influence had few impacts on trust toward lending platforms and perceived institutional risks. The finding of this research provided a theoretical foundation for future academic studies as well as practical guidance for both borrowers and lenders lending on p2p platforms

The Price of Ethics:Evidence from Socially Responsible Mutual Funds

This paper estimates the price of ethics by studying the risk-return relation in socially responsible investment (SRI) funds. Consistent with investors paying a price for ethics, SRI funds in many European and Asia-Pacific countries strongly underperform domestic benchmark portfolios by about 5% per annum, although UK and US SRI funds do not significantly underperform their benchmarks. The underperformance of SRI funds does not seem to be driven by the loadings on an ethical risk factor. SRI funds do not suffer a cost of reduced selectivity nor do SRI funds managers time the market. There is mixed evidence of a smart money effect: SRI investors are unable to identify the funds that will outperform in the future, whereas they show some fund-selection ability in identifying ethical funds that will perform poorly. The screening activities of SRI funds have a significant impact on funds’ riskadjusted returns and loadings on risk factors: corporate governance and social screens generate better risk-adjusted returns whereas other screens (e.g. environmental ones) yield significantly lower returns.