Peter M. DeMarzo

Peter M. DeMarzo
Professor, Finance
Contact Info
PeterM.DeMarzo
The Staehelin Family Professor of Finance
Academic Area: 
Finance

Additional Administrative Titles

  • Director, Stanford LEAD Certificate: Corporate Innovation

Research Statement

Professor Peter DeMarzo’s research is in the area of corporate finance, asset securitization, and contracting, as well as market structure and regulation. Recent work has examined the optimal design of securities, compensation mechanisms, regulation of insider trading and broker-dealers, bank capital regulation, and the influence of information asymmetries on corporate disclosures and investment.

Bio

Peter DeMarzo is the Staehelin Family Professor and Professor of Finance, and Faculty Director for Educational Technology, and former Senior Associate Dean for the GSB.  He has published research on corporate investment and financing, asset securitization, financial contracting, and market regulation.  Recent work has examined the optimal design of securities, compensation mechanisms, regulation of insider trading and broker-dealers, bank capital regulation, and the influence of information asymmetries on corporate disclosures and investment.  He is co-author of Corporate Finance and Fundamentals of Corporate Finance (Pearson Prentice Hall 2012). He has served as president of the Western Finance Association and director of the American Finance Association.  He is a Research Associate of the National Bureau of Economic Research. Before joining Stanford, he was on the faculty of U.C. Berkeley’s Haas School of Business, Northwestern University’s Kellogg Graduate School of Management, and a National Fellow at the Hoover Institution.  DeMarzo received a Ph.D. in Economics in 1989 and M.S. in Operations Research in 1985 from Stanford University, and a B.A. in Cognitive Science and Applied Mathematics in 1984 from U.C. San Diego. His research has received awards including the Barclays Global Investors/Michael Brennan best paper award from the Review of Financial Studies, and the Western Finance Association Corporate Finance Award. He won the Sloan Teaching Excellence award in 2004 and 2006, and the Cheit Outstanding Teaching Award in 1998. He currently teaches MBA and PhD courses in Corporate Finance and Financial Modeling.

Academic Degrees

  • PhD, Stanford University, 1989
  • MS, Stanford University, 1985
  • BA, UC San Diego, 1984

Academic Appointments

  • At Stanford 1995-1997 and since 2000
  • Associate Professor, Haas School of Business, UC Berkeley, 1997-1999
  • Visiting Associate Professor, Stanford GSB, 1995-1997
  • Associate Professor, Kellogg Graduate School of Management, Northwestern University, 1992-97
  • National Fellow, Hoover Institution, 1992-1993
  • Asst. Professor, Kellogg Graduate School of Management, Northwestern University, 1989-1992

Awards and Honors

  • Ormond Family Faculty Fellow, Stanford GSB, 2013-2014
  • Review of Financial Studies Best Paper Award, Barclays Global Investors/Michael Brennan, 2006
  • Sloan Teaching Excellence award, Stanford GSB, 2006
  • Sloan Teaching Excellence award, Stanford GSB, 2004
  • Corporate Finance Award, Western Finance Association, 2001
  • Cheit Outstanding Teaching Award, Haas School of Business, 1998
  • Clarendon Lectures, Oxford University, 2011
  • Bettis Distinguished Scholar, 2010
  • Michael Brennan Award, Review of Financial Studies, 2008
  • Utah Winter Finance Best Paper Award, 2004

Publications

Journal Articles

Peter M. DeMarzo. Journal of Economic Theory. January 22, 2016, Vol. 163, Pages 410-434.
Peter M. DeMarzo. Journal of Finance. 2012, Vol. 67, Issue 6, Pages 2295-2340.
Peter M. DeMarzo. American Economic Review. December 2011, Vol. 101, Issue 7, Pages 2955-2979.
Peter M. DeMarzo, Ron Kaniel, Ilan Kremer. Review of Financial Studies. 2008, Vol. 21, Issue 1, Pages 19-50.
Peter M. DeMarzo. Review of FInancial Studies. 2007, Vol. 20, Pages 151-188.
Peter M. DeMarzo, Michael J. Fishman. Review of Financial Studies. 2007, Vol. 20, Issue 6, Pages 2079-2128.
Peter M. DeMarzo, Ron Kaniel, Ilan Kremer. Journal of Financial Economics. 2007, Vol. 85, Issue 3, Pages 735-754.
Peter M. DeMarzo, Yuliy Sannikov. Journal of Finance. December 2006, Vol. 61, Issue 6, Pages 2681-2724.
Peter M. DeMarzo, Branko Uroševic. Journal of Political Economy. 2006, Vol. 114, Issue 4, Pages 774-815.
Peter M. DeMarzo, Ilan Kremer, Andrzej Skrzypacz. The American Economic Review. September 2005, Vol. 95, Issue 4, Pages 936-959.
Peter M. DeMarzo. Review of Economic Studies. 2005, Vol. 72, Pages 687-706.
Peter M. DeMarzo. Review of Financial Studies. 2005, Vol. 18, Pages 1-35.
Peter M. DeMarzo, Ron Kaniel, Ilan Kremer. Journal of Finance. 2004, Vol. 59, Issue 4, Pages 1677–1716.
Peter M. DeMarzo, Dimitri Vayanos, Jeffrey Zwiebel. Quarterly Journal of Economics. 2003, Vol. 118, Issue 3, Pages 909-968.
Peter M. DeMarzo, Darrell Duffie. Econometrica. 1999, Vol. 67, Issue 1, Pages 65–99.
Peter M. DeMarzo. Economic Theory. 1999, Vol. 13, Pages 1-24.
Peter M. DeMarzo. Journal of Financial Intermediation. 1999, Vol. 8, Pages 241-269.
Peter M. DeMarzo. Journal of Economic Theory. 1998, Vol. 80, Pages 123-152.
Peter M. DeMarzo. Journal of Political Economy. 1998, Vol. 1998, Pages 602-632.
Peter M. DeMarzo. Journal of Mathematical Economics. 1996, Vol. 26, Pages 479-497.
Peter M. DeMarzo. Econometrica. 1996, Vol. 64, Pages 1-27.
Peter M. DeMarzo. Mathematics of Operations Research. 1996, Vol. 21, Pages 26-43.
Peter M. DeMarzo. Review of Financial Studies. 1995, Vol. 8, Pages 743-771.
Peter M. DeMarzo. Review of Economic Studies. 1993, Vol. 60, Pages 713-734.
Peter M. DeMarzo. Games and Economic Behavior. 1992, Vol. 4, Pages 72-100.
Peter M. DeMarzo. Journal of Political Economy. 1992, Vol. 100, Pages 41-61.
Peter M. DeMarzo. Journal of Economic Theory. 1991, Vol. 1991, Pages 261-286.

Books

Jonathan B. Berk, Peter M. DeMarzo, Jarrad Harford Boston: Prentice Hall, 2015.
Jonathan B. Berk, Peter M. DeMarzo Boston: Pearson Prentice Hall, 2014.

Working Papers

The Leverage Ratchet Effect | PDF
Anat R. Admati, Peter M. DeMarzo, Martin F. Hellwig, Paul Pfleiderer, May 262017
Risking Other People's Money: Gambling, Limited Liability, and Optimal Incentives | PDF
Peter M. DeMarzo, Dmitry Livdan, Alexei Tchistyi2014
Fallacies, Irrelevant Facts, and Myths in the Discussion of Capital Regulation: Why Bank Equity is Not Expensive | PDF
Anat R. Admati, Peter M. DeMarzo, Martin Hellwig, Paul Pfleiderer, October 222013

Teaching

Degree Courses

2017-18

This course will expose students to the fundamentals, best practices, and advanced techniques of corporate financial modeling. We begin with basic operating and integrated financial statement models, and ultimately develop financial models to...

Students will engage in the development of corporate financial modeling cases and solutions. Students will also develop materials to aid others in building financial models, and serve as case leaders during lab workshops. Extensive background in...

2016-17

This course covers the foundations of finance with an emphasis on applications that are vital for corporate managers. We will discuss many of the major financial decisions made by corporate managers, both within the firm and in their interactions...

This course will expose students to the fundamentals, best practices, and advanced techniques of corporate financial modeling. We begin with basic operating and integrated financial statement models, and ultimately develop financial models to...

Students will engage in the development of corporate financial modeling cases and solutions. Students will also develop materials to aid others in building financial models, and serve as case leaders during lab workshops. Extensive background in...

2015-16

The course will take the perspective of a mid-level manager or decision-maker who is responsible for collecting, analyzing, and utilizing financial information in the context of a major transaction. We will integrate theories presented throughout...

Students will engage in the development of corporate financial modeling cases and solutions. Students will also develop materials to aid others in building financial models, and serve as case leaders during lab workshops. Extensive background in...

Executive Education & Other Non-Degree Programs

Service to the Profession

  • Research Associate, National Bureau of Economic Research, 2003-present

Insights by Stanford Business

August 30, 2016
Stanford GSB professors suggest articles and books related to the concept of “equity.”
June 17, 2016
Banks are not alone when it comes to being overleveraged.
April 30, 2015
Those in the know share where to go to learn more about reward and related topics.
August 4, 2014
Big bonuses tempt executives to gamble with company money, but they may make sense for a company in crisis.
October 29, 2013
A finance professor says big banks need tougher capital regulations — for our sake, and for theirs.
January 28, 2013
How, and why, Stanford's Anat Admati took on the banking system.
May 14, 2012
Why bankers like leverage — and what that could mean for the global financial system.
April 18, 2012
A new study shows executives are quick to report good news — but hold the negative for a flood of bad economic news in the media.
June 1, 2011
Boston Fed CEO Eric Rosengren says money market mutual funds are vulnerable to the European debt crisis.
September 1, 2010
A finance professor says raising bank capital requirements would produce widespread social benefits as well.
October 1, 2007
People tend to cluster around risky categories out of a desire to avoid missing "the next big thing."

School News

May 27, 2016
As the Stanford LEAD Certificate: Corporate Innovation program enters its second year, it is challenging assumptions about the limitations of online education.
November 5, 2014
Innovative certificate program brings Stanford’s exceptional on-campus teaching elements to interactive, collaborative online experience.