About

I am a PhD candidate in economics at Harvard University, with concentrations in finance and macroeconomics. Prior to my doctoral studies, I worked at the National Bureau of Economic Research and studied finance and statistics at the Wharton School of the University of Pennsylvania.

Research Interests: Finance, Macroeconomics, Behavioral Economics

Email: seanclee@g.harvard.edu

📢 I am on the job market in the 2023-2024 academic year.


References

John Y. Campbell
john_campbell@harvard.edu

David Laibson
dlaibson@harvard.edu

Andrei Shleifer
shleifer@fas.harvard.edu

Adi Sunderam
asunderam@hbs.edu

Job Market Paper

Credit Card Borrowing in Heterogeneous-Agent Models: Reconciling Theory and Data [SSRN]
(with Peter Maxted)

Abstract

Constrained, “hand-to-mouth,” households with zero liquid wealth are a central building block of modern heterogeneous-agent consumption models. We document empirically that many of these seemingly borrowing-constrained households actually revolve intermediate levels of high-interest credit card debt, meaning that they are not constrained at either the zero-liquid-wealth kink nor at their credit card borrowing limit. This finding presents a challenge: how can heterogeneous-agent models generate empirically realistic marginal propensities to consume without relying on borrowing-constrained households? We show that present bias induces households to revolve modest levels of credit card debt, but their indebted saving behavior still generates elevated MPCs. We then apply this insight to highlight key channels through which credit card borrowing reshapes households’ responses to fiscal and monetary policy.

Working Papers

Household Liquidity and Macroeconomic Stabilization: Evidence from Mortgage Forbearance
(with Omeed Maghzian)
[FRBB WP Version]

Abstract

We estimate the impact of household liquidity provision on macroeconomic stabilization using the 2020 CARES Act mortgage forbearance program. We leverage intermediation frictions in forbearance induced by mortgage servicers to identify the effect of reducing short-term payments with little change in long-term debt obligations on local labor market outcomes. Following statewide business reopenings, a one percentage point increase in the share of mortgages in forbearance leads to a 30 basis point increase in monthly employment growth in nontradable industries. In a model incorporating geographical heterogeneity in intermediation frictions, these responses imply a household-level marginal propensity to consume out of increased liquidity that aligns with existing estimates for direct fiscal transfers. The implied debt-financed fiscal multiplier effects of forbearance are sizable but depend on the repayment terms of deferred payments and the monetary policy stance.

Financial Windfalls, Portfolio Allocations, and Risk Preferences
(with Joseph Briggs, David Cesarini, Erik Lindqvist, and Robert Ă–stling)
[NBER WP Version]

Abstract

We investigate the impact of financial windfalls on household portfolio choices and risk exposure. Exploiting the randomized assignment of lottery prizes in three Swedish lotteries, we find a windfall gain of $100K leads to a 5 percentage point decrease in the risky share of household portfolios. We show theoretically that negative wealth effects are consistent with both constant and decreasing relative risk aversion and analyze how our empirical estimates help distinguish between competing models of portfolio choice. We further show our results are quantitatively aligned with the predictions of a calibrated dynamic portfolio choice model with nontradable human capital and consumption habits.

Estimating Discount Functions with Consumption Choices over the Lifecycle
(with David Laibson, Peter Maxted, Andrea Repetto, and Jeremy Tobacman)
[NBER WP Version]
Accepted at Review of Financial Studies

Abstract

We estimate β-δ time preferences and relative risk aversion (RRA) using a lifecycle model including stochastic income, liquid and illiquid assets, credit cards, dependents, Social Security, mortality, and bequests. Preference parameters are identified by cross-tabulating four lifecycle age intervals and four balance sheet moments: the proportion of households carrying (i.e., revolving) credit card debt, average carried credit card debt, average net wealth among households carrying credit card debt, and average net wealth among households not carrying credit card debt. The sixteen moments are approximately matched by (MSM) parameter estimates β = 0.53, δ = 0.99, and RRA = 1.9.