We propose target date funds modified to exploit stock return predictability driven by the variance risk premium. The portfolio rule of these tactical target date funds (TTDFs) is extremely simplified relative to the optimal one, making it easy to implement and communicate to investors. We show...

Individuals form economic expectations for a given region by extrapolating from the economic outcomes of another geographic area, a phenomenon we term 'spatial extrapolation.' We exploit the scenario when Out-of-town (OOT) buyers purchase property in places different from their previous...

This paper documents a strong relationship between households' perceptions about inflation over the past 12 months and households' short- and long-term expectations about future inflation. This relationship is strong during periods of high-inflation but even stronger during low-inflation...

Relying on a large and unique dataset on the cash withdrawals of over 165 million bank cards from China, we find that the existence of a larger number of cash withdrawals late at night is associated with more criminal activity. The effect is stronger for those crimes that are more involved in...

Unpredictable income poses a significant threat to economic stability for many U.S. households. While budgeting may help to mitigate some of the negative effects of unpredictable income, the process of budgeting can also be more challenging under such circumstances. This paper presents new...

Exploiting 150 million points of purchase by US households, we examine how negative ESG shocks ripple through product market and shape consumption. We show that the sales of affected products drop by an average of 5 - 10%, comparing with that of unaffected products consumed by the same...

“Buy Now, Pay Later” (BNPL) is a key innovation in consumer finance in recent years. Using a randomized experiment at an e-commerce company, we document that – when BNPL is available – customers spend 20% more, with low-creditworthiness customers being most responsive to the introduction...

We experimentally examine the mechanisms underlying peer effects in financial markets. We hypothesize that individuals are not too confident about how to process information regarding financial markets and thus look among their peers for someone who is more capable in processing the information...

Using around 8 million housing transactions in California from 1994 to 2017, I find that Chinese overseas buyers (COB) earn 4.5% lower returns than other cash buyers, controlling for market timing and location factors. The large gap in housing returns is driven by purchase prices instead of sale...

The Housing Provident Fund (HPF), a mandatory saving scheme providing dis- counted mortgages, is a prevailing self-funded housing finance program in several emerging countries. China, in particular, established the Housing Provident Fund to promote homeownership, especially for the low income....