Finance

Finance is an applied branch of economics that studies the ways in which individuals, business entities, and other organizations allocate resources over time and make decisions in the presence of uncertainty.

The faculty in the finance area have wide-ranging expertise in all major areas of finance, including:

  • Asset pricing, or how security prices and interest rates are determined in the market.
  • Corporate finance, or how corporations raise capital and make investment decisions.

The faculty strive to produce a broad range of finance-related research that addresses topics of interest to academic researchers, practitioners, and policymakers. We communicate that research both through publication in scientific journals, and through the development of relevant and rigorous MBA and Executive Education programs. We also train and mentor future finance scholars through our PhD Program, which is regarded as one of the top finance doctoral programs worldwide.

Recent Journal Articles in Finance

Leonid Kogan, Dimitris Papanikolaou, Amit Seru, Noah Stoffman
The Quarterly Journal of Economics ( forthcoming ). November
2016, Vol. 131, Issue 4

We propose a new measure of the economic importance of each innovation. Our measure uses newly collected data on patents issued to US firms in the 1926 to 2010 period,...

Umit G. Gurun, Gregor Matvos, Amit Seru
Journal of Finance. October
2016, Vol. 71, Issue 5, Pages 2371-2416

Using information on advertising and mortgages originated by subprime lenders, we study whether advertising helped consumers find cheaper mortgages. Lenders that advertise more within a region sell more expensive mortgages,...

Erik Hurst, Benjamin Keys, Amit Seru, Joseph Vavra
American Economic Review . October
2016, Vol. 106, Issue 10, Pages 2982-3028

Regional shocks are an important feature of the U.S. economy. Households’ ability to self-insure against these shocks depends on how they affect local interest rates. In the United States, most...

Sumit Agarwal, gene Amromin, Itzhak Ben-David, Souphala Chomsisengphat, Tomasz Piskorski, Amit Seru
Journal of Political Economy (forthcoming). August
2016

We evaluate the effects of the 2009 Home Affordable Modification Program (HAMP) that provided intermediaries with sizeable financial incentives to renegotiate mortgages. HAMP increased intensity of renegotiations and prevented substantial...

Shai Bernstein, Xavier Giroud, Richard R. Townsend
Journal of Finance. August
2016, Vol. 71, Issue 4, Pages 1591-1622

We show that venture capitalists’ (VCs) on-site involvement with their portfolio companies leads to an increase in (1) innovation and (2) the likelihood of a successful exit. We rule out...

Bryan T. Kelly, Hanno Lustig, Stijn Van Nieuwerburgh
American Economic Review . June
2016, Vol. 1106, Issue 6, Pages 1278-1319

We examine the pricing of financial crash insurance during the 2007-2009 financial crisis in U.S. option markets. A large amount of aggregate tail risk is missing from the price of...

Shai Bernstein, Albert Sheen
Review of Financial Studies . May
19 , 2016, Vol. 29, Issue 9, Pages 2387-2418

How do private equity firms affect their portfolio companies? We document operational changes in restaurant chain buyouts between 2002 and 2012 using comprehensive health inspection records in Florida. Store-level operational...

Zhiguo He, Arvind Krishnamurthy, Konstantin Milbradt
American Economic Review. May
2016, Vol. 106, Issue 5, Pages 519–523

U.S. government bonds are considered to be the world’s safe store of value, especially during periods of economic turmoil such as the events of 2008. But what makes U.S. government...

Timothy James McQuade, Stephen W. Salant, Jason Winfree
Journal of International Economics. May
2016, Vol. 100, Pages 112–119

When importing durables and nondurables, consumers often cannot discern quality prior to purchase. If they cannot also identify the individual producer, exporters have diminished incentives to produce high quality goods....

YiLi Chien, Harold Cole, Hanno Lustig
Review of Economics Dynamics. April
2016, Vol. 20, Pages 215-239

This paper analyzes and computes the equilibria of economies with large numbers of heterogeneous agents who have different asset trading technologies, preferences and beliefs. We illustrate the value of our...