About
I am an assistant professor in management and strategy with a joint appointment in economics at HKU Business School. I received my BA from Harvard University in 2012 and my PhD from MIT in 2022. My research covers topics including labor service outsourcing, theory of the firm, money and barter, public housing, and rent control.
Here is my CV. You can reach me at mbwong@hku.hk or DM me on Twitter. If you’re a research-track student at HKU interested in economics, I’m occasionally looking for RAs. Feel free to email me!
Working Papers
(with Mayara Felix)
Last Updated: June 2023
Abstract (click to expand): We estimate the effect of domestic outsourcing on labor markets using Brazil's 1993 legalization, which sharply increased the outsourcing of security guards. We use a triple-differences design that leverages North-South variation in pre-legalization court permissiveness and compares guards to less affected occupations. We find that outsourcing legalization persistently increased total employment of security guards in more restrictive regions by 8% and reduced their average age by two years. The average wage of security guards did not fall in more restrictive regions, with some specifications showing a small positive effect. However, there was a wave of layoffs that reallocated incumbent security guards to other occupations and lower-wage firms. A simple model implies that the market-level efficiency gains from outsourcing legalization more than offset the earnings losses of incumbent workers.
Twitter thread
(with Duoxi Li)
Last Updated: November 2022
Abstract (click to expand): We develop and test a model of labor market dynamics with domestic outsourcing, productivity shocks, and endogenous separations. In the model, outsourcing may reduce worker rents, smooth labor demand, or both. Depending on the relative strengths of these two effects, outsourcing has different effects on worker hazard into non-employment. We use comprehensive administrative data on security guards and cleaners from Brazil to quantify the two effects. The estimates suggest that outsourcing significantly smoothed labor demand among security guards but did not significantly reduce their rents. By contrast, outsourcing had both demand-smoothing and large rent-stripping effects on the lower-wage occupation of cleaners.
Last Updated: February 2022
Abstract (click to expand): I analyze how digital currency issuance by a private online platform affected the volume of trade in a large barter community in Toronto. The community initially banned cash, but subsequently introduced a digital token that could be transferred among users and redeemed at designated local stores for retail goods. Using comprehensive transactions data, I show that a large monetary expansion persistently increased transaction volume by 70% by enabling monetized trade. However, when token redemption was suddenly halted at a subset of stores, a run on the token ensued and transaction volume fell. The findings are consistent with a search-theoretic model wherein money functions as a medium of exchange.
Twitter thread
Presentation Video (September 2022)
Last Updated: September 2023
Abstract (click to expand): This paper analyzes how a large-scale privatization of public housing affected population sorting and social welfare in Hong Kong. To estimate its effects, I leverage the scheme's staggered roll-out between 1998 and 2006. I find that privatization reduced average household sizes by 5-7% and increased average household income by 23% in treated estates over the following fifteen years. I also find very little leasing and resale after initial sale due to stringent restrictions. Interpreted through a model, my findings indicate that the scheme discouraged higher-income residents from vacating, worsened targeting of housing subsidies, deepened housing misallocation, and reduced social welfare.
(with Matthew Gentzkow and Allen T. Zhang)
Last Updated: July 2023
Revise and resubmit, AEJ: Micro
Abstract (click to expand): We study the role of endogenous trust in amplifying ideological bias. Agents in our model learn a sequence of states from sources whose accuracy is ex ante uncertain. Agents learn these accuracies by comparing their own reasoning about the states based on introspection or direct experience to the sources' reports. Small biases in this reasoning can cause large ideological differences in the agents' trust in information sources and their beliefs about the states, and may lead agents to become overconfident in their own reasoning. Disagreements can be similar in magnitude whether agents see only ideologically aligned sources or diverse sources.
Publications
Work in Progress
The Firm as a Nexus of Relational Contracts
(with Duoxi Li)
Means of Payment vs. Media of Exchange
(with Baiyun Jing)
Digital Money Adoption and Redemption Convenience
(with Baiyun Jing, Yang You, and Yulin Zhong)
Teaching
Current: Instructor for HKU’s PMGM7004 (Global Management from Economics Perspectives) and PMGM7019 (Economics of Strategy and Organization).
Previous: TA for MIT’s Intro Micro (undergrad, 2022), Intermediate Micro (undergrad, 2018-20), Applied Econ for Managers (EMBA, 2019), Org Econ (PhD, 2018), and Industrial Organization II (PhD, 2022).
Notes
Things I learned in Grad School (the Hard Way)
Other Writing
What Caused Hong Kong’s Housing Crisis?
(Hong Kong Economic Policy Green Paper, 2022-9-23, Twitter thread)
香港房屋危機之謎 (香港經濟政策綠皮書, 2022-9-23)
In Hong Kong’s Olympic glory, a glimpse of a hopeful new future (SCMP, 2021-8-4)
Liberal or conservative, Hongkongers must learn to listen to those they disagree with (SCMP, 2019-9-7, with Spike Lee and Josephine Au)
預算案500億推創科 怎用得其所 (香港經濟日報, 2018-3-18)
社會面對新挑戰 須3方面調整 (香港經濟日報, 2017-9-13)
