Tammaro Terracciano

We document the effects of electronic invoicing (eInvoicing) on credit markets. By making invoices more standardized, verifiable, and harder to falsify, eInvoicing changes lenders’ information sets, facilitating invoice-based financing and credit risk assessment. We exploit a regional eInvoicing mandate and administrative credit data using a difference-in-differences design to provide three main insights. First, credit reallocates toward firms already relying on invoice-based credit (“invoice firms”) and away from non-invoice firms. Second, the cost of (non-)invoice credit falls (rises) for (non-)invoice firms, consistent with a supply-driven mechanism. Third, banks' information production changes: eInvoicing widens (reduces) the dispersion of rates and banks' risk assessments and improves (worsens) their predictive accuracy for (non-)invoice firms. Overall, eInvoicing reshapes credit market outcomes, with uneven effects across borrowers.

Exporters pricing their goods in a foreign currency are exposed to foreign exchange (FX) risk, but they can hedge it by underwriting FX derivative contracts. This paper provides firm-level evidence on how the cost of FX hedging affects exporters' currency choice. We formalize the channel in a model in which a firm jointly chooses its invoicing currency and its optimal hedging ratio, predicting that cheaper hedging makes foreign currency pricing more attractive. Consistent with our model, we empirically find that hedging firms price their exports more in foreign currency, and especially in US dollars. We then exploit an unexpected increase in the cost of hedging and find that it leads hedging firms to reduce both dollar and local currency pricing, with larger effects for smaller firms. Finally, we show that hedging is associated with stickier export prices. Our findings indicate that cheaper FX derivatives markets nurture dollar dominance while weakening the link between prices and exchange-rate movements.

We study the demand for safety and liquidity in the crypto ecosystem. We do so under a framework in which a representative investor allocates liquidity across stablecoin deposits in lending pools and traditional safe assets (e.g., MMF shares). Our model delivers three main predictions: (i) the stablecoin deposit premium co-moves with the Treasury premium when investors value the safety and liquidity services of stablecoins; (ii) increases in Treasury supply reduce the stablecoin deposit premium; and (iii) drops in the perceived safety and liquidity of stablecoin deposits (e.g., due to de-pegs or hacker attacks) reduce their premium. Using granular data from hundreds of DeFi pools spanning multiple protocols, tokens, and blockchains, we find evidence supporting these predictions. Investors treat stablecoin deposits as money-like instruments that are borderless and permissionless, yet as fragile as other forms of privately produced safe assets.

Using a banking model, we show that the effects of introducing a Central Bank Digital Currency (CBDC) depend on the composition of the central bank’s balance sheet, especially excess reserves and the assets backing the CBDC. We find that banks optimally meet CBDC demand by liquidating excess reserves. Once these are exhausted, the central bank must expand its balance sheet. Only purchases of safe assets can keep the CBDC introduction neutral without pass-through funding, while risky asset backing reduces lending, making neutrality impossible. Finally, we discuss how CBDC holding limits should reflect the availability of safe assets and excess reserves.

When households have heterogeneous preferences for CBDC and the central bank commits to compensating banks for lost deposit funding, banks can profit from CBDC adoption. We analyze this mechanism by characterizing banks' optimal response to CBDC introduction and calibrating the model using Eurozone data. Our findings show that, without central bank intervention, banks reduce their profits by increasing deposit interest rates in response to CBDC competition to maintain an optimal level of lending. However, when the central bank provides funding to offset deposit losses, banks optimally let households move toward the CBDC by not competing to retain them.

Does the institutional environment shape whether green funds genuinely commit to the climate transition? Drawing on institutional theory, we argue that funds' home environments, shaped jointly by regulatory, normative, and cognitive forces, create distinct incentives to respond to forward-looking climate information. We test this by examining how green funds reallocate capital when firms discuss the climate transition in earnings calls, a costly and deliberate response that distinguishes substantive commitment from superficial positioning. We compare green funds across Europe and North America, two regions with contrasting institutional environments. We find that green funds increase their exposure to firms discussing the transition, but the effect is concentrated in European funds, whose response is approximately six times larger than that of their North American counterparts. The reaction of North American funds is also unstable: it fluctuates with the U.S. political cycle, intensifying during Democratic administrations. Our findings highlight how contrasting institutional environments shape the boundary between signaling and substance in sustainable investing, suggesting that the credibility of green finance depends as much on the institutional context as on the funds themselves.