Welcome!
My name is Sertan Ozsoy, and I am a 5th year PhD candidate in the Department of Economics at Arizona State University. I will be on the 2026/2027 job market.
My research interests are
Primary: Macroeconomics, Financial Economics
Secondary: Family Economics, Development
You can find my CV here.
Contact: sozsoy@asu.edu
When Does Credit Matter? Uncertainty, Credit Limits, and Firm Leverage (2025) - Job Market Paper
Abstract: Firms in developing economies borrow much less than firms in advanced economies, a fact typically attributed to tight collateral constraints and high borrowing costs, which have motivated large financial inclusion programs. However, credit expansions often have modest long-run effects, and many firms report no desire to borrow, suggesting that demand-driven limits to credit take-up may also be important. At the same time, firms in developing economies face higher exposure to idiosyncratic risk, which can affect their borrowing behavior. This paper studies how the interaction between borrowing limits and risk exposure shapes firms’ leverage decisions. Using panel balance-sheet data for publicly listed firms, I show that higher idiosyncratic uncertainty is associated with lower leverage, especially in more financially developed economies. I then develop a tractable heterogeneous-firm model in which firms choose leverage before idiosyncratic shocks are realized, subject to both collateral constraints and uncertainty. The model implies that, in the presence of uncertainty, external-finance-to-GDP alone cannot identify borrowing limits. To guide policy, I use the model to construct two metrics—the marginal effect on aggregate TFP of expanding firms’ access to credit and of reducing their exposure to risk—which help prioritize between relaxing collateral constraints and lowering risk.
Optimal Subsidies When Business Ideas are Uncertain (2025)
Abstract: Large, productive firms start as small, risky startups. Using panel data on French firms for the period 2000–2010, I show that young firms grow faster, are more volatile, and have less persistent productivity than older firms. At the same time, the average product of capital increases in the early years of a firm’s life and declines only gradually, a pattern inconsistent with models that feature only collateral constraints. I develop a quantitative entrepreneurial choice model with risk-averse agents, collateral constraints, and age-dependent risk in productivity. Early-stage uncertainty interacts with financial frictions to slow self-financing, reduce entry by poorer entrepreneurs, and prolong misallocation. In a calibrated small open economy, collateral tightening generates sizable output and welfare losses, which are substantially understated in models without age-dependent risk. Finally, I show that age-targeted subsidies for young firms can stimulate experimentation and yield large welfare gains.
The Welfare Impact of Motherhood - with Paula Calvo, Ilse Lindenlaub and Yoko Okuyama
Description: A growing body of literature has documented large motherhood penalties in labor market outcomes. However, its welfare implications are unclear because lower earnings need not translate into lower welfare within households that share resources. We use detailed data on married couples in Japan, which measure the allocation of consumption between spouses alongside labor market outcomes, demographics, social norms, attitudes, and marital histories. Using the data, we show that the motherhood penalty extends beyond labor market outcomes: women’s share of household consumption drops after having children. We then embed a collective household model with endogenous fertility, human capital accumulation, and divorce into an equilibrium model of the marriage market. The framework allows for heterogeneity in preferences, expectations about the mental load of motherhood, childcare constraints, and gender norms. We use the model to measure the welfare effects of motherhood, decompose the mechanisms that generate the motherhood penalty, and evaluate how policy reforms, such as childcare expansions, affect mothers’ welfare.
Instructor:
Intermediate Macroeconomics (Spring 2026, Summer 2025), Microeconomic Principles (Fall 2025)
Teaching Assistant:
Financial Economics (graduate), Financial Economics, Intermediate Macroeconomics, International Trade Theory, Macroeconomic Principles