Daihong Min (pronounced day-hong min)
Ph.D. Candidate in Economics
University of California, Davis
International Macroeconomics International Finance International Trade
📍 Office: 131 Social Sciences & Humanities Building, 1 Shields Ave, Davis, CA 95616
📧 Email: dhmin [at] ucdavis.edu
Biography
I am a Ph.D. candidate in the Department of Economics at the University of California, Davis. I will be on the 2026-2027 academic job market.
My research lies at the intersection of international macroeconomics, international finance, and political economy. I study how geopolitical risk, dollar-based financial infrastructure, and firm-level financing frictions shape currency choice in global trade and the transmission of shocks across countries.
My dissertation examines how U.S. financial sanctions affect dollar dominance in trade invoicing. Combining structural quantitative modeling with international invoicing data and firm-level measures of working-capital dependence, I show that sanctions can induce selective switching from dollar to RMB invoicing along financially vulnerable supply-chain links. I also maintain an interest in applied microeconomic policy evaluation, including the effects of sugar-sweetened beverage taxes.
Job Market Paper
“Financial Sanctions and the Dollar Dominance”
📄 Latest Draft (PDF) | 📊 Presentation Slides
Abstract: Does the weaponization of dollar finance undermine dollar dominance in global trade? Using a new panel of FX-neutral import invoicing shares from 2012 to 2023, I show that U.S. financial sanctions against Chinese entities induce a selective shift from dollar to RMB invoicing. The response is strongest among countries whose imports from China are concentrated in working-capital-intensive sectors, while countries with low working-capital exposure exhibit almost no RMB switching. This heterogeneity suggests that sanctions do not trigger broad de-dollarization uniformly; instead, they reshape invoicing choices along financially vulnerable supply-chain links. I develop a model in which dominant-currency invoicing offers normal-time liquidity and hedging benefits but exposes firms to sanctions-sensitive working-capital constraints. Exporters borrow to finance intermediate inputs, and banks provide cash-flow-based credit lines whose usable amount depends on the invoicing currency and the realized geopolitical credit state. As U.S. sanctions risk rises, dollar-linked credit lines become less reliable because of the threat of payment disruptions, asset freezes, compliance delays, and reduced dollar settlement capacity. Firms exposed to working-capital-intensive production therefore switch to RMB invoicing to stabilize borrowing capacity. In the model, working-capital exposure lowers the threshold at which a trade relationship abandons dollar invoicing. A quantitative calibration disciplines this threshold mechanism using the reduced-form RMB response. Removing working-capital heterogeneity eliminates the muted response among low-working-capital countries, showing that the working-capital channel is quantitatively central. The findings imply that sanctions can weaken dollar dominance not through universal de-dollarization, but through selective currency switching where dollar liquidity becomes a source of geopolitical funding risk.