Andrew Metrick YC ’89 was formally invested as the Janet L. Yellen Professor of Finance and Management during an event on November 26 at the Yale School of Management. Janet Yellen PhD ’71, former chair of the Federal Reserve, was in attendance, along with Yale administrators and staff members and Metrick’s colleagues, family, and friends.
This spring, Metrick, a leading finance scholar and an expert on financial crises, was appointed as the inaugural holder of the chair, named in honor of Yellen.
Dean Edward A. Snyder called it “a great day for Yale,” before inviting Arthur Okun Professor Emeritus of Economics William Brainard to deliver remarks.
Brainard, who first met Yellen during her days as a Yale graduate student in the late 1960s, said that Yellen’s career path has its roots in an encounter with his late colleague James Tobin, a Nobel Prize winner and the Sterling Professor of Economics, while she was an undergraduate at Pembroke College at Brown University.
“She said she heard his lecture and was so impressed by his strong sense of moral and social responsibility that it influenced her choice of an economics career,” said Brainard. (Yellen added that Tobin also influenced her decision to pursue graduate work at Yale in particular.) “There’s no doubt that [Yellen follows] the belief that economics is a servant for [promoting] welfare for humanity.”
Metrick’s colleague Gary Gorton, the Frederick Frank Class of 1954 Professor of Management and a professor of finance, said that Metrick’s career reflects a similar sense of responsibility.
“Andrew and I came to Yale at approximately the same time… in the middle of the financial crisis,” said Gorton. “There came a day when Andrew said, ‘This is the biggest economic event of our lifetimes, and I think I want to change my research program to work on it.’ I thought, ‘Most economists don’t have that reaction; most economists couldn’t even explain the financial crisis to you.’ I thought that was a very courageous thing to do.”
Metrick went on to establish the Yale Program on Financial Stability, which gathers and disseminates knowledge about the causes and management of financial crises. The creation of the one-year Master’s Degree in Systemic Risk followed, Gorton noted, as did many other projects and initiatives.
Of the Program on Financial Stability, Provost Benjamin Polak, William C. Brainard Professor of Economics, said, “This group isn’t just preserving the lessons [from the 2008 financial crises] that would otherwise be lost, but it’s also going to help change the world.”
Metrick said that he owes a debt of gratitude to Tobin, for whom he served as a research assistant at Yale for two and a half years, as well as to Yellen and Ellis. He said he has long aspired to “the Tobin mold of public service and strong, deep thinking being put together… We certainly would not be here today without him.”
Reflecting on the day’s event, Yellen said, “It’s a tremendous honor and great pleasure to take part in Andrew’s investiture as the inaugural Janet Yellen Professor of Finance and Management… Andrew, your research on systemic risk, particularly on the role placed by securitization, repo finance, and shadow banking, provide remarkable insight into the causes of the financial crisis and point to practical and effective ways to regulate these activities. Your work is really required reading for central banks worldwide.”
Charles D. Ellis YC ’59, founder of the investment consulting firm Greenwich Associates, who served on the Yale Corporation with Yellen, provided the afternoon’s concluding remarks, repeating an observation of Yellen from a conversation he had been a part of: “She has changed my whole concept of what a worthwhile life is all about. And I’m going to have to do the best I can with what she’s shown.”