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Control of the intracellular parasites causing malaria and visceral leishmaniasis (VL) is dependent on IFNγ+Tbet+CD4+ T (Th1) cells generated by infected hosts. IL-10 produced by Th1 cells mitigates subsequent inflammation and related pathology. However, IL-10-producing Th1 (Tr1) cells can also promote parasite persistence, as well as impair immunity following re-infection or vaccination. Here, we identify molecular and phenotypic signatures that distinguish Th1 cells from Tr1 cells in experimental VL caused by Leishmania donovani infection of C57BL/6 mice and in Plasmodium falciparum-infected humans participating in controlled human malaria infection (CHMI) studies. We identify LAG3 as an immune checkpoint target in VL, describe heterogeneity of co-inhibitory receptor expression by Tr1 cells and discovered a role for the transcription factor Pbx1 in suppressing CD4+ T cell cytokine production. Together, this work provides new insights into Tr1 cell functions that offer opportunities for strategies to modulate their functions to improve anti-parasitic immunity.

This paper studies the tail risk of US equity markets in advance of the COVID-19 outbreak in February 2020, providing evidence that financial markets are informative about pandemic risk well in advance of the actual outbreak. Specifically, while the tail risk of the market index did not respond before the outbreak, we document that the tail risk of less pandemic-resilient economic sectors boomed in advance. This result is robust to alternative specifications of tail risk measured from either option or credit default swap contracts. Long-horizon tail risk measures provide information about investors' perception of pandemic risk persistence and economic recovery.

I quantify largest shareholders’ private benefits of control, and their impact on stock prices, by estimating a structural model of optimal shareholding using data on the ownership dynamics of Italian public companies. The results show that controlling shareholders (i) extract private benefits on average around 2% of equity value, and (ii) generally have positive and persistent impact on stock prices. The results imply that large shareholders extract private benefits without cost for the rest of the company shareholders. I also provide evidence of a synergistic effect when the large shareholder is a corporation.

The upregulation of inhibitory molecules is a major driver of immune escape in cancer. In contrast, less is known about the regulation of T cell activating receptors within the tumor microenvironment. Here, we describe that tumor derived CD155, a transmembrane glycoprotein of the immunoglobulin superfamily, downregulates the activating receptor CD226 (DNAM-1) in mouse and human CD8+ T cells, leading to profound loss of effector function and cancer immune evasion. Mechanistically, CD155 drives internalisation of CD226 through phosphorylation of tyrosine 319 (CD226Y319). Accordingly, in T cells a mutation in Y319 led to increased CD226 surface expression improving the efficacy of cancer immunotherapies in mouse models of cancer. In pre-treatment samples from melanoma patients, CD226+ CD8+ T cells significantly correlated with response to immunotherapy and survival. In summary, we discovered a new paradigm in which tumor cells escape destruction by T cells through targeted downregulation of an activating receptor.

We show that the decision to participate in the stock market depends on the ability of equities to hedge the individual permanent earnings shocks, consistent with implications of life-cycle models. Those households who refrain from stock investing display positive correlation between their own permanent income innovations and market returns. These results owe to a two-step empirical strategy. First, a minimum distance estimation disentangles the aggregate from the idiosyncratic permanent component of labor income risks. The second step reconstructs the individual life-cycle dynamics of persistent shocks through a Kalman filter applied to the estimated labor income process. We are thus able to obtain the full cross-sectional distribution of individual correlations between permanent shocks and market returns.

This paper examines the constraints that negative externalities (i.e., smuggling from a large neighbor) impose on the application of automatic fuel price adjustment mechanisms. It is often recommended to establish an automatic price adjustment mechanism to reduce fuel subsidy expenditures, but this approach may not work in the presence of these externalities. The paper illustrates the constraints by examining the case of Nigeria, a major oil exporter that subsidizes gasoline, and that of Togo, an oil importer and neighbor of Nigeria. It finds that the price differential between formal prices in Togo and Nigeria is the main driver of changes in formal sector gasoline consumption. Specifically, the lower the formal price in Nigeria, the higher is smuggling from Nigeria to Togo, and the lower the tax base in Togo. The econometric results suggest that, unless the real economy is performing very well, increases in pump prices in Togo are likely to erode the tax base, unless there are greater border controls. The unintended consequences of Nigeria’s pricing policies are the constraint they impose on fuel pricing policies of its neighbors and the subsidy Nigeria transfers to them (equivalent to at least 3 percent of Togo’s GDP in 2011), three-quarters of which was captured by smugglers in 2011, while one-quarter enhanced consumers surplus through lower gasoline prices.

The default risk premium expresses the difference between the actual default risk of a company and the default risk implied by the securities issued by the company. In this paper, we study the simultaneous relationship between the dynamics of the default risk premium and both the dynamics of the stock price and the CDS (Credit Default Swap) spread of a company. We show that an increase in the default risk premium can be associated, at the same time, to either an increase in the stock price and a decrease in the CDS spread, or to a decrease in the stock price and an increase in the CDS spread. We document that the first type of relationship features securities belonging to a consistent risk-return framework, while the second type of relationship describes securities following a counterintuitive risk-return puzzle. We show this result theoretically end empirically, by adopting a contingent claim model. We estimate the model with a non-linear Kalman filter in conjunction with quasimaximum likelihood, and we shed light on the relationship over time between the default risk premium and both the equity value and the CDS spreads for a sample of non-financial firms.

Market leverage is one of the main determinants for defining the optimal capital structure of the firm, and has a significant impact on several variables that affect the design of the firm's business strategy. This paper is focussed on the potential methodologies exploitable to obtain reliable estimates of the firm's market leverage. This is a relevant issue as many factors make obscure the actual dynamics of the firm's leverage. We estimate the unknown parameters that determine the stochastic properties of the unobservable variable, by using maximum likelihood estimation and the Kalman filter approach. The starting point of our analysis is the seminal Merton model (1974), which describes the firm's asset value dynamics with a pure diffusion process, improved with the early default risk as proposed by Duan et al. (2003). We report the simulation results for different possible estimation methods, and then perform an empirical analysis on real data of 25 European companies CDS premia.