I. Preparation
The study of financial economics requires a grasp of several types of basic mathematics. Students must enter with or very quickly acquire knowledge of the concepts and techniques of:
| Topic | Courses |
|---|---|
| Calculus |
|
| Linear Algebra |
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| Statistics/Probability |
|
It is strongly advised that students without a strong and recent background in calculus, linear algebra, or statistics come to Stanford in June to take courses to strengthen any weak areas.
Computer programming skills are necessary in coursework (as early as the first quarter of the first year) and in research. If students do not have adequate computer programming skills, they may wish to take a computer programming course before they arrive at Stanford, or take an appropriate Stanford computer science course while here.
II. Course Requirements
All required courses must be taken for a grade (not pass/fail or credit/no credit). Exceptions are made if the required course is offered pass/fail or credit/no credit only. Each course must be passed with a grade of P or B- or better. Substitutions of required courses require approval from the faculty liaison. Waiving a course requirement based on similar doctoral level course completed elsewhere requires the approval of the course instructor, faculty liaison, and the PhD Program Office.
| Topic | Courses |
|---|---|
| Economics (3 courses) |
|
| Statistical Methods (3 courses) |
|
| Finance Base Requirements (7 courses) |
|
| Finance Specialization Requirements (2 courses) |
Students specialize in one of two tracks in finance research. Capital Markets Track (min 2 of 3)
Corporate/Household/Banking Track
|
| General Field Requirements (4 courses) |
Students choose a minimum of two 2-course sequences from the alternative fields listed below. Courses may not be used to fulfill two general fields. In many cases, students interested in the field will want to take more than two of the suggested course in the field. Capital Markets*
*Students may select course sequence if not taken to fulfill the Finance Specialization requirement. Corporate/Household/Banking*
*Students may select course sequence if not taken to fulfill the Finance Specialization requirement. Economic Theory
Financial Market Design
Accounting
Advanced Macroeconomics
Industrial Organization
Advanced Econometrics
Labor Economics
|
III. Research Practicum
During the first year (including summer quarter), students will be assigned each quarter to work with a different faculty member. During autumn, winter, and spring quarters, the research practicum will involve mentoring and advising from the faculty member. The purpose of new assignments each quarter is to give the student exposure to a number of different faculty members. During the summer quarter, the student will work with a faculty member on a research project as a research assistant.
Students will enroll in FIN 699. Research Practicum in autumn, winter, spring, and summer quarters during year 1 with the respective faculty.
IV. Seminars
Students in all years regularly attend the Finance seminar. The only exception to this will be if there is a direct and unavoidable conflict between the seminar and necessary coursework.
V. Summer Research Papers
All students in all years are expected to complete a research paper over the summer, and present this paper in the Fall quarter. A draft of this research paper should be submitted by the end of September to the field liaison. Students can continue to work on and improve their paper up to their presentation. Presentations of summer research will always be viewed as research in progress.
For students completing their first year, the summer paper should demonstrate the mastery of a specific area in the literature. This can be accomplished by either (i) presenting the preliminary development of a research idea or (ii) presenting work with faculty (either co-authored or as a research assistant). The student will be expected to present this paper to a gathering of three Finance faculty members of the student’s choosing in October.
For students completing their second year, the summer paper should develop a research idea that was approved during the oral exam at the beginning of the summer (see below). “Develop” does not mean complete - students will be evaluated based on whether they have made reasonable progress on their research topic and on whether they have identified an appropriate research question. A passing grade on the second-year paper is one requirement for admission to candidacy.
In all years after the second year, the summer research paper should be a well-developed research paper. (Well-developed does not mean completed – research is always presented as work in progress. Rather, it means that the work shows enough progress and development to merit a seminar presentation.) Students will then present their papers to the overall Finance faculty and PhD student body in scheduled talks over the Fall quarter. Student presentations will typically be 45 minutes, save for job market paper presentations, which will be a full hour and a half.
More generally, these presentations throughout all years will be a primary manner that faculty who are not advising the student become familiar with the student’s work, and will play a crucial role in the assessment of the student’s academic progress.
VI. Field Exam
The Finance field exam is an oral exam that takes place at the end of the second year and is typically scheduled for the last week of June.
At the beginning of the spring quarter of the second year, students select three faculty examiners, including at least two faculty from the Finance area. The student meets with the selected faculty examiners to develop reading lists that will be covered in the exam.
These reading lists will each cover key papers in a broadly defined topic area (e.g. banking, macro-finance, corporate finance theory, empirical asset pricing), along with a few papers tailored to the student’s specific interests. The lists may be based on the reading lists from PhD courses, but this is not required. The suggested number of papers per faculty examiner is 25-30 papers (i.e. 75-90 in total); the length of the papers is at the discretion of the faculty examiner.
The student is expected to demonstrate mastery of the literature and identify key assumptions and open questions. This understanding serves as a foundation for further research towards the doctoral dissertation.
The Finance Oral Exam will be approximately 100 minutes in total:
- Reading list (75 minutes) - Each of the three faculty examiners will discuss papers from their reading list with the student for 25 minutes, to assess the student’s understanding of their chosen topic area.
- Second-year paper (25 minutes) - The faculty examiners and the student will discuss the student’s second year paper topic. The purpose of this discussion is to help the student select a research question for their second-year paper and identify the methods the student will use to address their chosen question.
At the end of the exam, the faculty will meet without the student present and determine the student’s grade for the exam: HP (High Pass), P (Pass), MP (Marginal Pass), and F (Fail).
VII. Assistantships
Students are required to complete a minimum of two quarters of research assistantships and two quarters of teaching assistantships prior to graduation.
VIII. Candidacy
Admission to candidacy for the doctoral degree is a judgment by the faculty of the student’s potential to successfully complete the requirements of the degree program. Students are required to advance to candidacy by September 1 before the start of their fourth year in the program.
The results of the field exam, the second-year summer research paper (presented in the fall of 3rd year), the student’s performance in first and second year courses, and the student’s overall performance in the program are all considered in the decision to admit the student to candidacy.
IX. University Oral Exam
The university oral examination is a defense of the dissertation work in progress. The student orally presents and defends the thesis work in progress at a stage when it is one-half to two-thirds complete. The oral examination committee tests the student on the theory and methodology underlying the research, the areas of application and portions of the major field to which the research is relevant, and the significance of the dissertation research. Students are required to successfully complete the oral exams by September 1 before the start of their fifth year in the program.
X. Doctoral Dissertation
The doctoral dissertation is expected to be an original contribution to scholarship or scientific knowledge, to exemplify the highest standards of the discipline, and to be of lasting value to the intellectual community. The Finance faculty defer to the student’s Dissertation Reading Committee to provide general guidelines (e.g., number of chapters, length of dissertation) on the dissertation.