Research

This paper studies how high-speed mobile internet (3G and 4G mobile communication technologies) affects firm entry and rural employment in China. I combine administrative data on firm registrations and the location of mobile cell towers to construct a novel panel dataset covering
the years 2008 to 2019 and over 2,000 counties in China. I find a persistent and robust positive correlation between cell towers and new firm registrations. The results suggest that high-speed mobile internet contributes to firm entry in China — one additional 3G/4G cell tower in the
previous year is associated with 5 additional new firms in a county of average population size. To investigate whether the rise of new entrepreneurs impacts rural development, I examine the impact of the number of high-speed cell towers on rural employment rates. The estimates indicate that high-speed mobile internet is associated with increased rural employment.

This paper shows how women’s suffrage in the United States led to a drop in political polarization in the early 20th century. Using state-level biannual panel data from 1870 to 1940, I find that state-level women’s suffrage gains led declines in polarization. On average, polarization in states that granted women voting rights was about 15.7% lower. About two-thirds of the overall effect comes from incumbent politicians changing their behavior in response to suffrage laws. Furthermore, I investigate the heterogeneous effects on parties and chambers. The observed convergence between the two parties was primarily driven by the Democrats acting “more Republican”, and the effect
was larger for House Representatives than Senators.

A stylized fact in development is “missing middle”, that is, there are many small firms, some big firms, but very few mid-sized firms. While previous works generally attribute the phenomenon to the quality of infrastructure, availability of resources, and institutions, little is known about the role culture and social norms play in this problem. This paper argues that kinship systems, or extended families or clans, restrict the growth of firms in developing countries. I test it with a global firm dataset and find that stronger kinship ties are associated with smaller firms. Small firms are less likely to grow to mid-size in places where kinship is tighter. I then investigate how kinship strength affects a firm’s labor decisions and find that it increases the use of temporary workers and lowers the top manager’s experience working in the sector. This suggests that the trust gap between in and out-group members may explain why firms stay small. However, kinship ties are not just bad:
they might as well help firms get inputs more easily and at a lower cost through established networks or as implicit collaterals, especially for new firms. I test this by examining the relationship between kinship strength, access to finance, and the cost of labor. The findings suggest
that those effects are evident, especially among small firms. Finally, I test the channel of reinvestment, i.e., kinship hinders growth because it requires a firm to spend its earnings on redistribution rather than investments. Looking into the impact of kinship on investment decisions
and total factor productivity, I find that stronger kinship is associated with fewer re-investments among mid-sized firms despite higher TFP. My findings suggest a fundamental role the traditional culture and norms play in the realm of firm behavior and growth in the contemporary world.