Three Essays in International Business and Economics
Open AccessThis dissertation examines the ways in which government policies, specifically immigration, stimulus, and infrastructure policies, influence the behaviors of firms and households. Chapter 1 studies the impact of immigration policy on firms' labor market strategies and the varying responses due to firms' financing constraints. By using the 2012 Deferred Action for Childhood Arrivals (DACA) as an exogenous shock and analyzing over 200 million online job postings, the chapter reveals that jobs requiring lower complex problem-solving skills are more prevalent in regions with higher exposure to undocumented immigrants. This downgrading of skills is particularly notable among financially constrained firms.Chapter 2 investigates the role of local agglomeration linkages in mitigating the negative effects of the Covid-19 shock on firm imports. Analyzing high-frequency data from over 7 million import transactions into the US, the chapter demonstrates that the disruptions to large firm imports and county-level employment were less severe in areas with greater Paycheck Protection Program (PPP) loan distribution. The effects are most significant in counties with numerous small suppliers, higher input-output industry linkages, and a larger share of small and medium enterprises (SMEs), emphasizing the importance of local resiliency in buffering trade supply shocks when SMEs are supported.Chapter 3 utilizes microdata on the trading behavior of more than 13 million individuals to establish that the construction of new roads to previously unconnected areas enhances stock market participation. The chapter presents evidence supporting two channels: a financial inclusion channel, in which the establishment of new bank branches following road construction improves financial inclusion and subsequently stock market participation; and an information channel that captures enhanced information flow after road construction. This research suggests that improving physical infrastructure addresses the dual challenges of financial access and inadequate information, fostering a better integration of investors in remote and rural areas.
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