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, July 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,
December 2016, with F. Carozzi
- Blog entry (in Spanish)
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We study the allocation of investment projects by municipal governments across groups of
voters using data from a fiscal stimulus program carried out in Spain between 2009 and 2011.
This program provided municipalities with a large endowment to spend in public investments
and required the geocoding of each individual project. Combining these data with disaggregated election information at the census area level, we study whether politicians use expenditures to
target their supporters or to raise turnout. Estimates from regression, matching
and RDD methods show no evidence of local governments targeting areas of core support.
Instead, investment goes disproportionately to low turnout areas, suggesting that politicians
use funds to increase participation. We confirm this hypothesis by showing that, in the following elections, turnout is increased in areas that received more investment. Our results
suggest that mobilization can be a strong force in shaping the allocation of resources across
voter groups within cities.
Testing a large number
of hypotheses in approximate factor models, December 2014, with D. Amengual
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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
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- 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.
