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State governments in the United States often fund and support technology startups within their borders. Yet little is known about the magnitude with which these place-based policy interventions shift the performance trajectories of entrepreneurial firms. We provide new evidence based on 241 startups that compete for advanced research and technology commercialization loans between 2002 and 2008 through a Michigan-based program. Among applicants with project scores near the threshold required for funding, we find that award recipients are 20 to 30 percent more likely to remain in business four years after the competition relative to similar companies that seek but fail to receive funding. We also find that award receipt stimulates follow-on venture capital (VC) investments in surviving companies. The VC stimulus effect is, however, disproportionately driven by subsets of firms that are very young, relatively inexperienced at external fundraising, or located outside the dominant hub of entrepreneurial activity within the state. This distinctive pattern of heterogeneous effects remains visible for follow-on R&D financing from federal government sources, and for supplemental outcome measures that use news articles to track shifts in financing and business development activities. These findings are consistent with the view that public R&D programs are particularly beneficial when frictions in private resource markets are more severe. ; Accepted manuscript

We study the case of a Chinese industrial policy, implemented in Shanghai, that makes it mandatory for car manufacturers to share electro-mechanical performance and real time navigation data from their entire fleet of electric and hybrid vehicles with local and central government authorities. This policy seeks to reduce emissions, assess the performance of New Energy Vehicles (NEVs), prevent fraud in state subsidies and strengthen the competitiveness of Chinese manufacturers of these vehicles. We argue that economies of scope in data aggregation may provide traditional market failure arguments for government intervention and mandatory data pooling. Our paper also illustrates how data access regulation could be used for economic regime competition. The EU and China pursue very similar data policy goals that hinge on economies of scope in data aggregation. However, they follow very different political processes to achieve these goals.

This paper develops a new measure of state and local fiscal sustainability called the "trend gap," which is estimated from a panel data model and removes the short‐term influence of business cycles. The paper finds that the nationwide trend gap has grown over the past three decades. Education and social services and income maintenance programs have played a major role in the growth of the trend gap, while public pensions have become increasingly important in driving up the trend gap. The paper projects that the trend gap will continue to grow through 2026 in the absence of policy changes.

We develop a new measure of relative debt transparency by comparing the amount of state debt reported in the annual Census survey and the amount reported in the statistical section of the state Comprehensive Annual Financial Report (CAFR). GASB 44 requires states to start reporting their total debt in the CAFR statistical section in FY 2006. However, states are allowed to use accounting choices to exclude some dependent agencies' debt, which contributes to a gap between the two data sources. The regression results suggest that the gap tends to increase when states face greater fiscal stress or less political competition. Such patterns are not found in the pre-GASB 44 period.

This paper examines how changes in employers' access to job applicants' criminal histories affect ex-offender recidivism. We use extensive state administrative data on individual criminal histories spanning the 2010-2012 Massachusetts Criminal Offender Record Information (CORI) Reform, widely regarded as landmark legislation governing access to individuals' criminal information. The CORI Reform: i) banned inquiring about criminal history on initial job applications, and ii) broadened the list of groups eligible to use the state's criminal records repository while simultaneously restricting the scope of record access. Using survival analysis and panel regressions, we generally find small reductions in recidivism resulting from each component of the CORI Reform.

This thesis consists of two independent studies. The first study works on the effect of government regulation on financial markets. The second study analyses the multitask nature of government regulation in a regionally decentralized authoritarian regime. The first study examines the influences of the 1934 US Securities and Exchange Act on stock markets. The Securities and Exchange Acts of 1933/1934 are the first nationwide public laws of financial regulation in the world. By imposing mandatory information disclosure requirements, these laws are implemented with the aims of reducing speculation and manipulation of stock prices. Subsequent financial regulations all over the world follow the principles embedded in these two laws. However, 80 years later, the effects of these laws on financial markets are still under debate and continue to have deep implications on law and financial development at a global scale. In this study I examine the impact of the 1934 Act in reducing stock idiosyncratic volatility. Monthly firm-level idiosyncratic volatility series for NYSE/AMEX listed firms in the period of 1926 - 1970 are constructed from daily CRSP stock data; voluntary disclosed accounting data from "Moody's Manual of Investments 1934" are manually collected as a proxy of firms' disclosure quality before the law. The comparisons of the firm-level idiosyncratic volatilities before and after the enactment of the Acts show systematic evidence indicating that the Acts significantly reduce idiosyncratic volatility. Moreover, the firms that disclose much less the key accounting information before the implementation of the Acts, have experienced more reductions in volatility and are thus more deeply affected by the Acts than others. In addition, these firms are associated with further reductions in bid-ask spreads and additional improvements in liquidity after the enactment of the Acts. My findings suggest that one of the mechanisms, through which the Acts affect the market, have been identified. The second study explores the governance structure of government in a regionally decentralized authoritarian regime. The organizational form of Chinese central-local government is characterized by regionally decentralized authoritarianism (RDA) (Xu (2011)). This system is a combination of political centralization and economic regional decentralization. Political centralization implies that subnational officials' careers are determined by their superiors instead of constituencies; regional decentralization indicates that subnational governments are empowered to engage in regional development. At the early stage of economic reform, economic growth became the most important task. By utilizing yardstick competition reward based on economic performance, China's central government is successful in incentivizing local government officials to promote economic growth. However, unlike private enterprises, which concentrate on maximizing profits, government agencies are bound to pursue multiple goals. The multitask nature of government has become increasingly prominent and has created serious problems in China. By extending the Holmstrom and Milgrom (1991) multitask principal-agent model to a multitask-multiagent model, I explain under which conditions yardstick competition would fail in motivating local officials, and show that the optimal linear contract designed under a RDA regime is not capable of solving problems generated by the system itself. ; published_or_final_version ; Economics and Finance ; Doctoral ; Doctor of Philosophy

AbstractThis paper analyzes the impact of product market competition on unemployment, wage and welfare in a model where unemployment is caused by the efficiency wage consideration and oligopolistic firms compete in quantity. It is shown that while more intense competition in the product market increases output and reduces price, it does not necessarily lead to a lower unemployment rate or a higher wage for workers. Depending on the technologies, the relationship between the intensity of competition and the level of employment (respectively, wage, welfare) is not always monotonic, and, in some instances, has an inverted U‐shape.

This paper develops a new measure of state and local fiscal sustainability called the "trend gap," which is based on socioeconomic and other fundamental factors and removes the short-term influence of the business cycle. The paper estimates the trend gap and finds that the nationwide per capita trend gap has been on a growing path over the past three decades, a different conclusion than found in previous studies. Social insurance and income maintenance programs have played a major role in the growth of the trend gap, while pension and other post-employment benefits (OPEB) plans have become increasingly important in driving it up. In addition, there are large and growing disparities in the trend gap across states.