From Emperor Augustus to President Reagan, biased/misspecified beliefs such as superstitions and denialism are said to play substantial roles in leadership across contexts. Yet, we lack evidence on the economic costs of such widespread phenomena.  

This paper studies the macro impacts of governors' misbeliefs in China, exploiting prevalent cultural beliefs about space in Asia (Link: Trump and spatial superstitions in the U.S.) that allow us to link quasi-random, leader-specific spatial biases to regional development. We find that municipal zones that are supernaturally unfavorable to mayors have an average 2 to 3 percent lower GDP (compared to other zones).  This change results from reduced industrial expansion and public good investment, and a spatial equilibrium model shows that reactions of firms and citizens can further aggravate the impact. Misallocation analysis of 1.8 million firm-level observations suggests such biases likely impede allocative efficiency. The role of leader misbeliefs depends on institutional environments: it is more pronounced when government involvement is high and subordinate autonomy is limited; yet less institutional treatment has no significant mitigating effects. Supernatural biases may nonetheless preserve as they likely help reduce perceived uncertainty of leaders. 

Collectively, our results shed new light on how individual leadership shapes macro outcomes.

I study the impact of corruption crackdown on human capital supply for the state, exploiting China's staggered anti-corruption inspections. Using unique applicant data from state organizations, I find that anti-corruption induces positive selection for integrity and prosociality into the state sector, without significantly affecting overall ability. These shifts in supply are associated with enhanced work performance. Changes in occupational preferences corroborate static talent allocation as a salient mechanism, in which treated honest types show higher preferences for state jobs -- even when conditioned on ability and family background. I further document dynamic effects wherein households increase investment in human capital and the integrity of the next generation. Together, these findings highlight reward structures as an important determinant of the state's human capacity. 

We study favoritism in the selection of elite scientific talent, by examining the relationship between host institution affiliation and performance in the Chinese Science Olympiad, where a gold medal guarantees a student's admission to top universities. Using hand-collected participant-level data (2003 - 2021), we find that students affiliated with the host province have a significantly higher winning probability, and the effect is more pronounced in host provinces where corruption norms are more prevalent. We further present evidence suggestive of cheating behavior using a portion of the contest vulnerable to information leakage, as well as the centralized post-Olympiad selection outside the control of host provinces. Together, our findings shed light on the crucial role of the organizational structure in designing equitable assessment systems for talent. 

Using novel data from Taiwan, we examine the impact of history curricula on national identity. The regular-track high school curriculum reform of September 2006 separates the history of Taiwan from Chinese chronology and sharply increases Taiwan-oriented content to transmit Taiwanese identity. We document an unintended ``backlash'' that individuals studying under the new curriculum are more likely to report both greater Taiwanese and Chinese identities. We show endogenous changes in information demand as a prominent mechanism: treated high schoolers exhibit greater identity awareness and acquire more information related to both cultural identities, which in turn increases dual-identity recognition. We further observe consistent attitudinal changes, with milder political axes and an increased likelihood of voting for median candidates and abstention.