Karen Nershi

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I am a Postdoctoral Fellow at the Stanford Internet Observatory and Stanford's Center for International Security and Cooperation (CISAC). My research focuses on international political economy questions related to the use of new technology (especially cryptocurrency) as well as how new technology can be used to study traditional international political economy questions.

I earned a PhD in political science from the University of Pennsylvania. My dissertation examines cross-national variation in anti-money laundering enforcement looking specifically at cryptocurrency. My research has been supported by the University of Pennsylvania GAPSA Provost Fellowship for Innovation and the Christopher H. Browne Center for International Politics.

Before beginning my doctorate, I earned a B.A. in International Studies with honors at the University of Alabama. I have lived and studied Arabic in Amman, Jordan and Meknes, Morocco as a Foreign Language and Area Studies Fellow and a Critical Language Scholarship recipient. I also lived and studied in Mannheim, Germany, in addition to interning at the U.S. Consulate General Frankfurt (Frankfurt, Germany) and working for two years as an executive project manager.



Encina Hall, 4th Floor
616 Jane Stanford Way
Stanford University
Stanford, CA 94305-6055

nershi@stanford.edu

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1) How Strong Are Anti-Money Laundering Laws in Practice? Evidence from Cryptocurrency
Although many countries have adopted strict anti-money laundering laws, data leaks and a growing number of major money laundering scandals call into question how effectively countries enforce these laws. I provide insight into cross-national variation in enforcement by studying the application of a new customer due diligence law, which requires cryptocurrency exchanges to screen customers for money laundering risk. I collect a new dataset of cryptocurrency trades from 60 exchanges and compare levels of suspicious activity across exchanges by measuring trade “bunching” below a 1,000 USD/EUR threshold that requires customer due diligence. My research shows that there is significant variation in how well countries enforce anti-money laundering laws, a finding that holds important implications for international efforts to combat money laundering.

2) Estimating the Economic Costs of Money Laundering
Scholars argue that money laundering causes significant economic harm and identify economic costs as a potential mechanism driving countries to enforce anti-money laundering laws, but there is little documented evidence to support these claims. Another potential mechanism behind anti-money laundering enforcement is the risk of sanctioning by the Financial Action Task Force (FATF), an international organization dedicated to combating money laundering. In this project, I test the effect of two types of money laundering events – FATF blacklisting and news coverage of major money laundering cases – on three potential sources of economic harm (gross domestic product (GDP) per capita, financial instability, and foreign investment) using the robust synthetic control method. I show that FATF blacklisting contributed to a significant decrease in GDP per capita, while major money laundering cases did not significantly affect economic outcomes. This research provides the first quantitative estimates of the economic costs of two types of money laundering events, which holds important implications for understanding the mechanisms driving international cooperation in anti-money laundering enforcement.

3) Ties that Bind? Chinese Foreign Direct Investment & Political Influence in Africa
Over the past two decades, China has invested heavily in Africa alongside a growing demand for key minerals, leading some scholars to argue that investment has increased China’s political influence in receiving countries. Conversely, some argue that Chinese investment has created backlash as it extracts finite natural resources without creating local economic benefits. I test whether Chinese investment has led to political influence by measuring changes in attitudes toward China and support for democracy (the main alternative to the Chinese political model) in localities receiving Chinese investment. Using data from Afrobarometer, Pew Research, and AidData, I test this question across 297 localities in 25 African countries between 1999 and 2015 and employ Bartik-like shift-share instruments to exogenously predict Chinese investment. This paper provides evidence that Chinese investment has negatively impacted support for free elections in Africa (though there is no significant effect for other democracy-related outcomes) and offers a rigorous empirical test of whether foreign investment can produce political influence.




Introduction to International Relations
Teaching Assistant. Fall 2016 and fall 2020. Instructor: Professor Edward D. Mansfield

International Relations and Ethics
Teaching Assistant. Spring 2018. Instructor: Professor Mark A. Pollack

Introduction to International Relations
Teaching Assistant. Fall 2017. Instructor: Professor Alex Weisiger

International Political Economy
Teaching Assistant. Spring 2017. Instructor: Professor Mark A. Pollack



Please email me for syllabi, teaching evaluations, lecture slides, and other course materials.