1 | 2 | 3 | 4 | 5 | All | Print this article

« Back

The foundation and future of finance (continued)

Antoinette Schoar, Michael M. Koerner (’49) Professor of Entrepreneurial Finance

“We have seen a big change, and it feels like a big change,” said Antoinette Schoar, the Michael M. Koerner (’49) Professor of Entrepreneurial Finance, now in her 11th year at MIT Sloan. “It is very exciting to me that we are still small enough that every person counts. You really engage with everyone, but we are big enough that it is a critical mass of people, so if someone is on sabbatical or overseas, it is still okay. We have much more diversity of topics and interest, and that helps me in my own research. You draw on those stimuli.”

Such levels of collaboration will continue with the spring launch of a planned MIT Center for Finance and Policy, a cross-disciplinary effort to utilize the best that the Institute has to offer in its faculty, programs, and research. With oversight from the Finance Group, as well as an advisory board of MIT faculty and industry leaders, the center will focus on the intersection of public policy and financial theory and practice, bringing “a new level of intellectual substance and rigor to an area previously thought impossible to quantify,” said Lo.

“We have to be informed with the very best analytic thinking, and what’s been missing is nonpartisan analysis,” Lo said. “Each of us has our own political leaning, but we want to put those aside to make the best, most informed judgments. We don’t believe any organization is currently doing this for finance and policy, so we have a unique opportunity.”

Among the center’s pursuits, Lo envisions ongoing analytic research on policy issues; education and training for policymakers and their staffs; and periodic conferences to bring together policymakers, academics, visiting fellows, and a variety of interest groups on neutral ground.

“Aside from sponsoring research that’s relevant to this, one of the missions of the center will be educational,” Lucas said at the Finance Day event in April. “Somebody earlier asked a very good question: ‘If you come up with these great ideas inside of academia, how do you communicate them to the broader world? To policymakers?’ Today there’s a big gap. People talk about the digital divide, but I think there is a financial literacy divide between the government and the private sector. This isn’t only at the top; it permeates down to all staff levels and profoundly affects how decisions are made.”

“Policy is a little bit different because you are not actually telling someone how to make a financial decision; you are saying what the rules of the game for finance ought to be,” said Myers. “This is a mea culpa. We’ve been too passive about policy. We understood the savings and loan crisis before and while it was happening, but we did not go down to Washington and beat the drum. This is another area where MIT Sloan will be much more powerful and prominent moving forward.”

More »