Research

From employee to entrepreneur: The role of unemployment risk

with Ai Jun Hou, Sara Jonsson, Xiaoyang Li

Journal of Financial Economics, 2025. 

Key takeaways: Increased unemployment risk, instead of actual unemployment outcome, causally nudges employees into entrepreneurship. This nudge, however, is not associated with poor ex-post personal income or firm quality.

Media coverage: Swedish House of Finance Research in the Spotlight, DN Debatt, and ESBRI.

Effects of cultural origin on entrepreneurship

with Sara Jonsson

Journal of Economic Behaviour & Organization, 2023. 

Key takeaways: Individuals with stronger cultural risk-taking appetite are more likely to become entrepreneurs, although with poorer firm performance after the transition.

The Mechanical Disposition Effect 

with Shumiao Ouyang 

Selected presentations: WEFIDEV seminar, Tsinghua `SEM, Aalto University, Oxford Saïd, London Junior Finance Workshop 2025

Previously titled "The Fixed Disposition Effect"

Abstract: We propose that much of the disposition effect is mechanical: it arises from stable investment styles interacting with standard cost-basis accounting, rather than from a primitive preference for realizing gains. A simple benchmark shows that contrarian and momentum trading rules can generate sharply different disposition patterns even when investors never condition directly on return status. Using a unique linked dataset that combines a large-scale online experiment with real-world mutual fund transactions from Alipay, we confirm this prediction and document that the disposition effect is up to nine times stronger for contrarian than for momentum investors. We further show that investment style is highly stable across time and contexts, helping explain the persistence of the disposition effect, while a sharp zero-return discontinuity reveals a broadly shared but quantitatively modest residual role for realization preference. 

Yield Salience: Consumer Demand for Digital Money

with Shumiao Ouyang and Cameron Peng 

[Draft coming soon!]

Abstract: We study how consumers respond to interest incentives in digital payment environments by exploiting quasi-random variation in money market fund yields on Alipay’s Yu’ebao platform. Linking over a million user-month observations to user-specific yields, we estimate the elasticity of digital money demand at both extensive and intensive margins. A one-percentage-point increase in yield raises the probability of adoption by 5.6 pp and balances by 27%, largely through net inflows rather than internal reshuffling. Interestingly, we find no detectable response when yields are below 2%, suggesting a salience threshold in consumers’ attention to interest rates. This behavioral nonlinearity implies that interest-bearing digital payment instruments may have limited traction in low-rate environments—a key consideration for central banks contemplating interest-bearing CBDCs. More broadly, our findings highlight how interest incentives shape household financial behavior in digital ecosystems.

In and down: The Costs of Immigrant Investors

Selected presentations: Luxembourg Household Finance Workshop 2025, PhD Nordic Finance Workshop 2024, BFWG 2024, RBFC 2024

Abstract: This paper examines the portfolio diversification gap between immigrant and native-born investors using a comprehensive administrative dataset from Sweden. Leveraging a carefully matched investor sample, I document that immigrant investors incur a 37% higher return loss compared to natives, driven predominantly by underdiversification instead of high risky share. This gap persists even among second-generation immigrants, suggesting intergenerational disparities in wealth accumulation. I identify two key drivers: social integration and financial literacy. Immigrants with native-born partners or from countries with higher financial literacy levels experience lower return losses. However, merely extending the duration of stay in Sweden does not mitigate the gap. These findings highlight the need for policies that facilitate social integration and promote financial education to improve immigrants’ financial outcomes.

Experiment Participation and Investor Behavior 

with Shumiao Ouyang

What Matters to Investors Around the World?

with Christoph Huber, Elias Rantapuska, and Paul Smeets