Yale SOM Launches Behavioral Finance "Summer School"

Q: What might compel busy PhD students to attend summer school?
A: A chance to spend a week with the top researchers in an exciting field. The Yale School of Management completed its first summer school program in behavioral finance which ran from June 22-26, 2009.

Nicholas Barberis, Stephen & Camille Schramm Professor of Finance, directed the course with the help of Robert Shiller, the Arthur M. Okun Professor of Economics. Barberis explained the rationale for the program saying, "Behavioral finance is a vibrant and active field, but behavioral finance scholars tend to be concentrated in a small number of schools so relatively few universities offer a PhD-level course. Bob Shiller and I felt that there would be strong demand for a short, intensive course on this material. And Yale is a natural home for the program."

Yale SOM has become one of the leading centers for behavioral research of all sorts. For example, in addition to Shiller, Barberis, and other members of the SOM finance faculty working in behavioral finance, economist Keith Chen’s studies of behavioral biases and marketing professor Ravi Dhar’s work on consumer behavior have added significantly to the quickly developing and broad-ranging field. The multidisciplinary approach of much behavioral research is also reflected in the school’s integrated MBA curriculum.

The faculty for this summer program included two founders of behavioral finance with Shiller and Richard Thaler of the University of Chicago. Rounding out the presentations from Yale faculty, SOM assistant professor James Choi discussed household finance. Guest lecturers from other institutions included Malcolm Baker of Harvard who spoke on behavioral corporate finance, Paul Tetlock of Columbia University who spoke about media influences on the stocks market, and Camelia Kuhnen from Northwestern who introduced the students to neuroscience-based research.

The 40 attendees were all doctoral candidates in economics, finance, and related disciplines. They came from institutions such as Harvard, the Wharton School at the University of Pennsylvania, Stanford, MIT, and the London School of Economics. Students reported positive experiences. In addition to the academic content, it was an opportunity to connect with their counterparts at other schools.

Professor Barberis pointed out, "An important reason why we could offer this program is because of a very generous grant from Andrew Redleaf of Whitebox Advisors. The grant is intended to support behavioral finance research at Yale, and the summer program is a high impact way of putting the donation to work."