I am an assistant professor at the department of Economics, Uppsala University and a research affiliate at CESifo.
I received my PhD from CEMFI, Madrid in 2015.
My research covers topics in applied economics such as political economy, housing economics, and econometrics.
Political budget cycles with informed voters: evidence from Italy, June 2017
Accepted at The Economic Journal
- show abstract
I exploit a reform that required Italian municipalities to disclose their balance sheets before elections to study whether having more informed voters affects the political budget cycle.
Municipal investment in the year before elections is 28.5% higher than in electoral years, and the reform reduced this pre-electoral spending increase by one-third.
I then study the role of local newspapers in disseminating municipal financial information to voters and find that the effect of the reform is twice as large in areas with relatively many newspaper readers,
suggesting that mayors react to more informed voters by reducing spending manipulation.
The Price of Inattention: Evidence from the Swedish Housing Market, October 2017, with A. Solis
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Do behavioral biases affect prices in a high stake market? We study the role of left-digit bias in the purchase of an apartment, one of the most important assets in a household's portfolio. Left-digit bias is the inability to fully process digits after the first, perceiving prices just below a round number (such as $3.99) as cheaper than their round counterpart ($4). We start by documenting that apartments listed at just-below asking prices are sold at a 3-5% higher final price after an auction. This effect appears not to be driven by i) differences in observable characteristics, ii) differences in real estate agents' behavior or iii) institutional characteristics of the market. We show that apartments using just-below prices attract more bidders and bids, leading to a higher competition and to a higher final price. Our results suggest that inattentive buyers might be losing roughly half a year of disposable income.
Distributive Politics inside the City? The Political Economy of Spain's Plan E,
September 2017, with F. Carozzi
- show abstract
We study distributive politics inside cities by analysing how local governments allocate investment
projects to voters across neighbourhoods. In particular, we ask whether politicians use
investment to target their own supporters. To this aim, we use detailed geo-located investment
data from Plan E, a large fiscal stimulus program carried out in Spain in 2009-2011. Our
empirical strategy is based on a close-elections regression-discontinuity design. In contrast to
previous studies - which use aggregate data at the district or municipal level - we exploit spatial
variation in both investment and voter support within municipalities and find no evidence
of supporter targeting. Complementary results indicate that voters may be responding to investment
by increasing turnout. Overall, our findings suggest that distributive politics only
play a minor role inside the city
- SERC working paper version (Feb. 2017)
- Blog entry (in Spanish)
Testing a large number
of hypotheses in approximate factor models, December 2014, with D. Amengual
- show abstract
We propose a method to test hypotheses in approximate factor models when the number of restrictions under
the null hypothesis grows with the sample size. We use a simple test statistic, based on the sums of
squared residuals of the restricted and the unrestricted versions of the model, and derive its asymptotic
distribution under different assumptions on the covariance structure of the error term. We show how to
correct the expressions for the limiting mean and variance in the presence of both serial and cross-section
correlation and provide estimators for those quantities that are easy to implement. Finally, we illustrate
the small sample performance of these testing procedures through Monte Carlo simulations and apply them to
reconsider Reis and Watson (2010)'s hypothesis of existence of a pure inflation factor in the US economy.
Sending the pork home:
birth town bias in transfers to Italian municipalities
(with F. Carozzi) Journal of Public Economics (134), February 2016, Pages 42-52
- show abstract
- link to the published version
- data and replication files
We ask whether the birthplaces of Italian members of Parliament are favoured in the allocation of central government transfers. Using a panel of municipalities for the years between 1994 and 2006, we find that municipal governments of legislators' birth towns receive larger transfers per capita.
Exploiting variation in birthplaces induced by parliamentary turnover for estimation, we find that this effect is driven by legislators who were born in a town outside their district of election.
As a result, we argue that our findings cannot be a consequence of re-election incentives, the usual motivation for pork-barrel policies in the literature. Rather, politicians may be pursuing other personal motives. In line with this hypothesis, we find that the birth town bias essentially disappears when legislative elections are near.
We explore several possible mechanisms behind our results by matching parliamentarians to a detailed dataset on local level administrators.
