Firm Expectations and Economic Activity

Essays on Firm Performance, Innovation, and Cross-Border Economic Activity

Seeing is Believing: The Impact of Local Economic Conditions on Firm Expectations, Employment and Investment

I show that managers overweight observations of local economic conditions at firm headquarters (HQ) when forming their macroeconomic expectations. This implies that HQ local economic conditions have an excessive impact on firm investment and employment growth. Using an empirical strategy identifying the impact of local economic conditions at HQ on employment outside the HQ, I find that a 1 perc...

Firm Ownership and Economic Efficiency

JEL: D24, L33

Economic policy uncertainty and firm-level investment

This paper examines the effect of economic policy uncertainty and its components on firm-level investment. It is found that economic policy uncertainty in interaction with firm-level uncertainty depresses firms’ investment decisions. When firms are in doubt about costs of doing business due to possible changes in regulation, cost of health care and taxes, they become more guarded with investmen...

Partisan Bias, Economic Expectations, and Household Spending

Individuals who support the winning candidate in U.S. Presidential elections become significantly more optimistic about the economy after the election, a phenomenon we utilize to measure the effect of partisan bias on economic expectations. The well-documented rise in political polarization among the electorate over the past 20 years has been accompanied by a substantial increase in the effect ...