Working papers and Works in progress

I propose a new mechanism that brings heterogeneity at equilibrium in organizational forms (vertical integration versus outsourcing) in a given industry, without necessarily requiring innate productivity differences. To do so, I present a model where final goods producers (irrespective of whether they are vertically integrated with the upstream stage or specialized in the downstream stage only) need a basket of differentiated commodities, in addition to labor, to create the fixed capital needed for production. I then show the existence of an equilibrium populated simultaneously by vertically integrated and non-integrated firms and I study the properties of such an equilibrium. The stable equilibrium is characterized by similar fixed cost requirements for integration and outsourcing.

This paper investigates the impact of ransomware attacks on firms’ financial accounts. We combine a dataset of ransomware incidents with balance-sheet information for more than two million firms in Europe. We estimate treatment effects using a doubly robust difference-in-differences approach. We find that attacks significantly weaken liquidity: firms’ liquidity ratios decline, driven primarily by an increase in current liabilities. The pattern is consistent with bridge financing and emergency credit lines to fund response and recovery, alongside delayed insurance reimbursements. The results indicate that ransomware primarily strains liquid resources, highlighting the vulnerability of corporate buffers to cyber shocks.