Candidate Name: Zixin Jiang
Program: Business Administration (Finance)
Committee Chairs: Dr. Yongqiang Chu​​​​​​​
Committee Members: Dr. Patrick Smith, Dr. Chandler Lutz, Dr. Kelly Vosters
Abstract:

This dissertation consists of two essays on mortgage markets. The first essay investigates how loan officers' political ideology influences their pricing of climate risk in mortgages. Using voter registration data for loan officers originating residential mortgages in coastal areas, I find that Democratic loan officers charge higher rate spreads for mortgages on properties exposed to sea level rise than do Republican loan officers. The results hold with granular property location and loan officer fixed effects. Partisan pricing is more pronounced for properties outside FEMA-designated flood zones, for loan officers located in hurricane-prone states, and in communities with fewer climate change believers. These findings highlight how political ideology shapes the pricing of climate risk in mortgages. The second essay examines how bank mergers affect loan officer reallocation and mortgage lending. I find that mortgage loan officer turnover increases after bank mergers. The effect is more pronounced for officers working in areas where both target and acquiring banks have mortgage businesses. Officers staying in the merged banks originate more loans than those leaving for other banks. The findings suggest that merged banks try to improve efficiency by reducing redundant employees. Focusing on officers in overlapping areas, I find that officers in merged banks originate fewer loans closer to their offices and fewer small loans after mergers. These results suggest that bank mergers lead to the loss of soft information and limit the availability of small mortgages. Together, these essays provide evidence on how individual and institutional forces shape mortgage market outcomes, with implications for risk pricing and credit availability.