I am a Ph.D. candidate in the Joint Program in Business and Economics at the University of Michigan.
I am on the job market in 2021-2022 and available for interviews at the virtual EJME and ASSA.
Research Fields: International Economics, Macroeconomics
Address: 701 Tappan Ave, Ann Arbor, MI 48109
Telephone: +1 (734) 263-4680
This paper provides causal evidence of the impact of industrial policy on firms' long-term performance and quantifies industrial policy's long-term welfare effects. Using a natural experiment and unique historical data during the Heavy and Chemical Industry (HCI) Drive in South Korea, we find large and persistent effects of firm-level subsidies on firm size. Subsidized firms are larger than those never subsidized even 30 years after subsidies ended. Motivated by this empirical finding, we build a quantitative heterogeneous firm model that rationalizes these persistent effects through a combination of learning-by-doing (LBD) and financial frictions that hinder firms from internalizing LBD. The model is calibrated to firm-level micro data, and its key parameters are disciplined with the econometric estimates. Counterfactual analysis implies that the industrial policy generated larger benefits than costs. If the industrial policy had not been implemented, South Korea's welfare would have been 22-31% lower, depending on how long-lived are the productivity benefits of LBD. Between one-half and two-thirds of the total welfare difference comes from the long-term effects of the policy.
Lobbying, Trade, and Misallocation
Latest Draft, submitted
Presentations: Midwest Macroeconomics Meetings 2019, National Tax Association’s Annual Conference 2021, AFES 2021, AMES 2021, ESAM 2021