Professor Elena Loutskina, PhD

Professor Elena Loutskina, PhD
Current Position

since 1/21

Research Fellow Department of Financial Markets

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

since 1/06


University of Virginia

Research Interests

  • financial intermediation

Elena Loutskina joined the Department of Financial Markets as a Research Fellow in January 2021. Her research focuses on financial intermediation. She uses empirical methods to examine, for example, the funding restrictions of small and medium-sized companies, the systemic resilience of banks, or the role of real estate finance for businesses, households and banks.

Elena Loutskina is a Professor at the Darden Graduate School of Business Administration, University of Virginia since 2006. She holds the Peter M. Grant II Bicentennial Foundation Chair and is a Fellow of the Wharton Financial Institutions Center. In 2019 she received the prestigious UVA Alumni Association Distinguished Professor Award. Previously, Elena Loutskina taught at the Carroll School of Management at Boston College, where she received the Donald J. White Teaching Excellence Award.

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Professor Elena Loutskina, PhD
Professor Elena Loutskina, PhD
- Department Financial Markets
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Drilling and Debt

Erik P. Gilje Elena Loutskina Daniel Murphy

in: Journal of Finance, No. 3, 2020


This paper documents a previously unrecognized debt‐related investment distortion. Using detailed project‐level data for 69 firms in the oil and gas industry, we find that highly levered firms pull forward investment, completing projects early at the expense of long‐run project returns and project value. This behavior is particularly pronounced prior to debt renegotiations. We test several channels that could explain this behavior and find evidence consistent with equity holders sacrificing long‐run project returns to enhance collateral values and, by extension, mitigate lending frictions at debt renegotiations.

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Stress Tests and Small Business Lending

Kristle R. Cortés Yuliya Demyanyk Lei Li Elena Loutskina Philip E. Strahan

in: Journal of Financial Economics, No. 1, 2020


Post-crisis stress tests have altered banks’ credit supply to small business. Banks most affected by stress tests reallocate credit away from riskier markets and toward safer ones. They also raise interest rates on small loans. Quantities fall most in high-risk markets where stress-tested banks own no branches, and prices rise mainly where they do. The results suggest that banks price the stress-test induced increase in capital requirements where they have local knowledge, and exit where they do not. Stress tests do not, however, reduce aggregate credit. Small banks seem to increase their share in geographies formerly reliant on stress-tested lenders.

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Fiscal Stimulus and Consumer Debt

Yuliya Demyanyk Elena Loutskina Daniel Murphy

in: Review of Economics and Statistics, No. 4, 2019


In the aftermath of the consumer debt–induced recession, policymakers have questioned whether fiscal stimulus is effective during periods of high consumer indebtedness. This study empirically investigates this question. Using detailed data on Department of Defense spending for the 2007–2009 period, we document that the open-economy relative fiscal multiplier is higher in geographies with higher consumer debt. The results suggest that in the short term (2007–2009), fiscal policy can mitigate the adverse effect of consumer (over)leverage on real economic output during a recession. We then exploit detailed microdata to show that both heterogeneous marginal propensities to consume and slack-driven economic mechanisms contribute to the debt-dependent multiplier.

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Working Papers


Labor Market Polarization and Student Debt

Sanket Korgaonkar Elena Loutskina Constantine Yannelis

in: SSRN Working Paper, 2024


This paper uses a new empirical design to explore how labor market polarization affects individuals’ incentive to pursue education funded on the margin by student debt. We argue that the labor market polarization–where automation replaces mid-skill and mid-education-level job–changes the marginal benefits of education and training and sharpens incentives to incur student debt. We advance a new measure of labor market polarizations that allows to capture the heterogeneity of this phenomena across geographies and time. Using this measure, we find that U.S. CBSAs that experience deeper labor market polarization see an increase in student debt balances and in the number of people pursuing student debt. On average, the decline in middle-skill jobs and wages has little effect on individuals’ ability to pay down existing student debt. The effects are most pronounced in ZIP codes with lower average credit scores, lower incomes, and higher share of the minority population.

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