Tri Vi Dang



Lecturer in Economics

Department of Economics

Columbia University



Office phone: 212 8514005




Research interest: financial contracting; financial intermediation; financial crises; financial liberalization and economic transformation in China


Teaching: corporate finance; money and banking; private equity and hedge fund investing







Graphical illustration of the papers on liquidity and information sensitivity [Site]


Google Scholar Citation [Site]



Published Papers


Bargaining with Endogenous Information, Journal of Economic Theory 140 (2008), 339-354.

The responder of a take-it-or-leave-it offer can capture full surplus in a perfect Bayesian equilibrium.


Information Provision in Over-the-Counter Markets (with M. Felgenhauer), Journal of Financial Intermediation 21 (2012), 79-96. Lead Article

An oligopolistic market structure for rating services arises endogenously and it is welfare improving for security issuers to pay for rating services rather than investors.


Banks as Secret Keepers (with G. Gorton, B. Holmström and G. Ordonez), American Economic Review 107 (2017), 1005-1029. [Online Appendix]

In order to create money-like securities banks must keep information about assets secret and hold loan portfolios with low information sensitivity while projects with high information sensitivity are financed in capital markets.

Media coverage: [Bloomberg], [Financial Times], [WSJ]


Market Sentiment and Innovation Activities (with Z. Xu), Journal of Financial and Quantitative Analysis 53 (2018), 1135-1161.

We formalize a typical venture capitalists’ view and provide empirical evidences for the financing and sentiment spillover channels through which high market-wide sentiment (bubbles) stimulate R&D investments and patent productions.


Information Sensitivity in Banking and Capital Markets (with G. Gorton and B. Holmström), Annual Review of Financial Economics, forthcoming.

We discuss theoretical and empirical work on information sensitivity in banking, money, bond and equity markets and its implications for liquidity, financial crises and macroeconomics.



Working Papers


Information Acquisition, Noise Trading and Speculation in Double Auction Markets

With endogenous information as markets become sufficiently large an efficient equilibrium allocation fails to exist.


Ignorance, Debt and Financial Crises (with G. Gorton and B. Holmström), UPDATED VERSION, 04/2015

Debt backed by debt collateral (debt-on-debt) is the optimal security in funding markets (such as repo, senior MBS, ABCPs, MMFs), but a change in macroeconomic fundamentals can cause information insensitive debt to become information sensitive and thus a collapse of trade.


The Information Sensitivity of a Security (with G. Gorton and B. Holmström), UPDATED VERSION, 03/2015

We derive a new characteristic of a security and discuss several applications.


Haircuts and Repo Chains (with G. Gorton and B. Holmström)

There are four joint determinants of repo haircuts, (i) the information sensitivity of collateral, (ii) the default probability of borrower, (iii) the intermediate liquidity needs of lender, and (iv) his default probability in a subsequent repo transaction.


Information Disclosure, Intertemporal Risk Sharing and Stock Prices (with. H. Hakenes)

Optimal Risk sharing through partial information disclosure can minimize the market value of the firm.


Taxation, Information Acquisition and Trade in Decentralized Markets: Theory and Test (with X. Liu and F. Morath)

We show that a transaction (profit) tax leads to more (less) private information production and decreases (increases) the probability of efficient trade in equilibrium and use the introduction of a transaction tax in the Singaporean housing market as a quasi-natural experiment to provide supportive evidence for the transaction tax theory.


Shadow Banking Modes: The Chinese versus US System (with L.Liu, E. Wang, H. Wang and A. Yao), previous version entitled Chinese Shadow Banking: Bank-Centric Misperceptions, HKIMR Working Paper No. 22/2014.

We provide a comprehensive set of market statistics and theoretical analysis of Chinese shadow banking and show that the system is bank-centric, driven by asymmetric perceptions of implicit guarantees and relies on an intervening government as well as highlight the differences from the US system.


The Option Value of a Bureaucrat as Successor CEO: Theory and Test (with Q.He)

We derive an option value theory of a bureaucrat as successor CEO and conduct an empirical test based on 2,454 CEO turnovers cases in Chinese firms which shoes that bureaucrat firms have (i) positive abnormal announcement stock returns, (ii) lower long run returns, (iii) larger cross-sectional variance and skewness of long run returns, (iv) obtain more loans and government subsidies, (v) but experience increased rent seeking.


The Effects of Mandatory Pollution Abatement on Corporate Investment and Performance: Theory and Evidence from a US Regulation (with Y. Wang and Z. Wang)

We provide a theory and empirical evidence for mandatory pollution abatement regulation to stimulate corporate investment in innovation.


Banking Relationships and the Transmission of Liquidity Shocks: Evidence from a Natural Experiment (with Y. Bai, Q. He and L. Lu)

We use the liquidity crunch in the Chinese interbank lending markets in 2013 as a quasi-natural experiment to show how relationship banking affects corporate borrowing.



Work in Progress


When Insurance Reduces Risk-Taking: Theory and Evidence (with J. Lai, I. Yan and X. Yi)


A Regulation Triggered Stock Market Panic and Who Runs First? (with H. Chen, H. Tu, and W. Xu)


Industry Risks and Equilibrium Bank Loan Contracts: Theory and Evidence from an Underground Lending Scandal (with Y. Li and J. Mo)


Incentivicing Chinese Banks to Lend: Theory and Evidence from the 3+X Credit Program (with Y. Liu and X. Xu)


Managing the Chinese Stock Markets (with W. Li and Y. Wang)



Presentation Slides


Ignorance, Debt and Financial Crises [Slides]


Banks as Secret Keepers [Slides]


Chinese Shadow Banking: Bank-Centric Misperceptions [Slides]







Corporate Finance, Undergraduate Lecture Course


Money and Banking, Undergraduate Lecture Course


Private Equity and Hedge Fund Investing, Senior Seminar Course