By Soumik Dey |Aug 19, 2022
CAF’s Summer Research Conference papers discussed pressing issues, finer nuances of finance and the global economy
The annual flagship Summer Research Conference (SRC) of the Centre for Analytical Finance, Indian School of Business (ISB-CAF), is always well-attended. But this year’s virtual conference garnered tremendous interest from the finance and economic research fraternity.
With a record submission of 125 papers this year for the SRC from across 20 nations, the selectors had a tough time picking up just eight papers for presentation at the conference this year.
“The quality of papers and selectors are both fantastic this year,” said Bhagwan Choudhary, Professor of Finance and Executive Director of Digital Identity Research Initiative (ISB-DIRI). He highlighted that in the 2013-19 duration, close to 60 per cent of the selected papers were also selected for publication by research journals.
“About 50 per cent of the selected papers were published in top-tier economics and finance journals,” added Professor Choudhary in his opening remarks. Post-2019, through the pandemic for two years, the Conference was organised online. This year’s virtual one was well received and attended by about 90 from the finance and economic research community. Philipp Schnabl, Professor of Finance, Martin J. Gruber, Professor in Asset Management at New York University Stern School of Business, and co-editor of the Journal of Financial Economics, was the keynote speaker for 2022.
The keynote at this Conference was delivered in past years by well-recognised researchers, leading global economists and Nobel laureates.
This year, as part of his keynote address, Professor Schnabl presented his paper titled ‘Credit Crunches and the Great Stagflation’ at the Conference. The paper analyses economic downturns visible across the US economy between 1965-82 and how finance can define monetary policy or the macroeconomic environment. About four severe recessions with surging inflation led to a fundamental rethinking of economic theory and policy.
“The standard explanation was that Fed failed to control demand. But there was less focus on the “stag” part of stagflation, which invoked a series of negative supply shocks,” said Professor Schnabl, citing the need to relook at this part of US’s economic history, particularly at a time when the nation-continent is experiencing inflation levels surge again. “But inflation does not talk about the low growth part,” said Professor Schnabl.
Looking at the US’s high inflation and low growth rate, he said the common notion that inflation stimulates the economy may not always hold.
Jokes and smiles contribute to light moments amidst the serious, purely academic conference.
In his closing remarks at the SCF 2022, Krishnamurthy Subramanian, Professor of Finance, ISB, expressed gratitude to the sponsors National Stock Exchange for their long association with ISB-CAF and the Summer Research Conference.
The Summer Research Conference of the Centre for Analytical Finance was attended this year by 90 scholars from globally eminent institutions.
His post-mortem of the US economy at the time indicates that the Fed's hiking of interest rates to tame inflation eventually led to credit crunches and a supply shock for the US economy.
His analysis at the Conference concluded that the inflated costs of materials and credit led to supply shocks and stagflation.
Learn more about the fantastic selection of research papers presented during the SRC, 2022 here.
The Conference awarded the best Discussant, and the Best Research paper presented. The National Stock Exchange (NSE) sponsored the awards and was announced by Tirthankar Patnaik, Chief Economist, NSE.
Anthony Cookson, Associate Professor of Finance at Leeds School of Business, the University of Colorado at Boulder, received the Best Discussant award of USD 2,000 for his discussion on the paper ‘Smart (Phone) Investing? A within investor-time analysis of new technologies and trading behaviour.’
Authors of the research paper ‘Smokestacks and the swamp’ - Emilio Bisetti, Assistant Professor of Finance, Hong Kong University of Science and Technology; Stefan Lewellen, Assistant Professor of Finance, Pennsylvania State University; Arkodipta Sarkar, Assistant Professor of Finance, The Hong Kong University of Science and Technology and Xiao Jhao, Assistant Professor, Terry College of Business, University of Georgia – won the award for Best presenter.
The authors received a cheque for USD 5,000 as part of their award.
“The finance faculty at ISB, the Conference sub-committee and the Research Associates at ISB who do the pre-screening of the papers for the Conference all have heavy involvement for this conference behind the scenes.
There is also a lot of organisational work to bring out this Conference. I thank the CAF and ISB staff for their contributions to making this conference a success,” said Professor Subramanian.
This year a higher number of faculty members (51 vs 40 previously) from globally eminent academic institutions joined the conference’s programme committee. Professor Amit Goyal, Senior Chair, Swiss Finance Institute and Professor of Finance, University of Lausanne; Professor Sumit Agarwal, Professor of Finance at the National University of Singapore and Professor Prasanna Tantri, Associate Professor, Finance and Executive Director – Centre for Analytical Finance formed the organising committee of the Conference. Professor Pradip K Yadav, Member, Editorial Board, The Review of Finance, The University of Oklahoma, presided over the second day of the Conference.