Iris Yao

I'm a 6th year PhD candidate in Finance at NYU Stern. My research interests are consumer finance, macroprudential policy, and corporate finance. I am on the 2022-2023 job market.

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Current Research

I analyze how household leverage responds to debt-to-income (DTI) limits by considering a DTI tightening in Canada. I show that the policy effectively reduced household leverage through its effects on mortgage lending, along the extensive margin (fewer mortgages) and intensive margin (smaller mortgages). I present evidence that adjustment of non-mortgage debt is an important policy consideration and households exhibit window-dressing behavior around the time of origination by adjusting their non-mortgage debt. Prospective homebuyers who are above the DTI limit before origination reduce non-mortgage debt in order to satisfy DTI limits at origination but subsequently re-accumulate debt after origination. I show that this behavior is driven by the regulatory DTI cutoff and not unobserved shocks which may correlate with the home purchase decision and similar debt dynamics around origination. I also show that household adjustments of non-mortgage debt can affect the impact of DTI limits on macroeconomic variables such as house price growth.

Journal of Urban Economics: Insights, Aug. 2022

We document large-scale urban flight in the United States in the wake of the COVID19pandemic. Populations that flee are disproportionately younger, whiter, and wealthier. Regions that saw migrant influx experience greater subsequent COVID-19 case growth, suggesting that urban flight was a vector of disease spread. Urban residents fled to socially connected areas, consistent with the notion that individuals were sheltering with friends and family or in second homes. The association of migration and subsequent case growth persists when instrumenting for migration with social networks, pointing to a causal association.