Essays on Credit Markets and on Information

In the first chapter of my thesis, titled “Interventions in Credit Markets and Effects on Economic Activity: Evidence from Brazil,” I investigate the impact of the Brazilian government policy implemented in March 2012, which aimed at increasing credit supply through public banks. Using bank branch level data, I find that the policy successfully increased overall credit supply, as increased lending of public banks did not significantly offset private lending. On the other hand, there is no evidence of significant client-switching between private and public banks. However, the effects of the policy on economic activity were limited and even negligible. I conduct a series of robustness checks to further explore this puzzling result. I find evidence suggesting that increased lending led to significant increases in deposits, indicating that borrowers leveraged easily accessible credit to take loans and save funds for future use. In the second chapter, titled “Television Introduction and Agricultural Production,” I investigate how improved information affected agricultural activity in the U.S. Specifically, I argue that the introduction of television brings more comprehensible weather forecast information to farmers, improving their decision making process. Using data about television entry and county level farming production in a difference-in-differences methodology, I estimate economically significant effect of television introduction on crop yields

Intensity of competition and technological progress

The empirical phenomenon that in monopolized markets technological improvements are small compared to competitive markets is to be examined. The level of technological advancements has been measured by how big improvement a new technology represents compared to the current best technology used in the market. The relationship between intensity of competition and technological progress has been examined in a model where R&D laboratory exerts effort, which is translated into a new technology, such that its profits are maximized. It is shown that intensity of competition affects the amount of technological progress in a non-monotone way.1