Dmitry Livdan (Haas): The Economic Impact of Payment System Stress: Evidence from Russia

The Stanford AFTLab invites you to the AI & Big Data in Finance Research Forum (ABFR) webinar:

The webinar is on November 21, 9-10am Pacific Time (12-1pm ET)

Presenter: Dmitry Livdan (UC Berkeley) 

Discussant: Filippo Mezzanotti (Northwestern) 

Zoom webinar link: https://stanford.zoom.us/j/99398933825?pwd=YH3xVT5ZPULD8p8Gu9Gov4Ymu8UOrG.1

Webinar ID: 993 9893 3825

Passcode: 127797

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Title: The Economic Impact of Payment System Stress: Evidence from Russia 

Authors: Dmitry Livdan (UC Berkeley), Norman Schürhoff (Lausanne), Vladimir Sokolov (Higher School of Economics)

Abstract: We explore the systemic importance of stress in the payment system. Analyzing 133 million transactions from the Russian payment system, we document that shocks affecting firms’ payment access primarily propagate upstream within the customer-supplier network and affect central firms more. In a production economy model with access-to-payment shocks, payment stress disrupts firm-firm payments directly and indirectly through adjustments in the input-output network. The macroeconomic impact leads to a 7.5% GDP decline during the 2004 interbank loan market panic, contrasting with a 1.1% decline during the 2022 Russia-Ukraine conflict due to foreign bank departure. These findings highlight how real-financial network linkages matter in sanctioning nations.

Bio of speaker: Dmitry Livdan is an Associate Professor of Finance at the Haas School of Business at UC Berkeley. His research expertise and interests are in corporate finance, asset pricing, and market microstructure. He obtained his PhD in Finance from the Wharton School at the University of Pennsylvania. He also obtained a PhD and M.Phil in Physics from the City University of New York and B.Sc. in Physics from Kharkov State University. 

Bio of discussant: Filippo Mezzanotti is an Associate Professor of Finance at Northwestern's Kellogg School of Management. His research interests are in empirical corporate finance, innovation and entrepreneurship. His current projects cover a variety of topics regarding how financial frictions affect real economic activity, the importance of patent policy for corporate innovation, and fintech. In analyzing these issues, he exploits evidence from both contemporaneous and historical events. Filippo joined the Finance Department at Northwestern's Kellogg School of Management in August 2016 as a Donald P. Jacobs Scholar. Filippo grew up in Italy and he received a B.A. and a M.Sc. in Economics from Bocconi University. After moving to the US, he obtained a MA and Ph.D. in Business Economics from Harvard University.