Faculty
Hui Chen is the Nomura Professor of Finance and a Professor of Finance at the MIT Sloan School of Management.
His research focuses on asset pricing and its connections with corporate finance. Chen is particularly interested in the interactions between the macro economy and term structure, credit risk, and corporate financing or investment decisions. His recent research projects include application of business cycle models to explain corporate financing behavior and corporate bond pricing, as well as analysis of the effects of incomplete markets on entrepreneurial financing and investments.
Chen holds a BA in economics and finance from Zhongshan University, an MS in mathematics from the University of Michigan, and a PhD in finance from the University of Chicago.
Current Research Focus: Chen's research focuses on (1) the impact of financial frictions on asset pricing and corporate decisions, and (2) the intersections of economics and machine learning. One of his recent projects studies the interactions between financial distress and price competition. Firms tend to compete on prices more when they are in financial distress. More intense competition can in turn reduce firms' profit margins and push weaker firms further into distress. By studying this feedback loop, the paper generates new insights into how the industry structure and strategic concerns affect price competition and credit risk. In another recent study on how to integrate machine learning tools with economics, he proposes building deep-learning-based surrogates for computation-intensive structural models, which can speed up model evaluation and estimation by orders of magnitude.
Chen, Hui, Winston Wei Dou, Hongye Guo, and Yan Ji. Journal of Finance. Forthcoming. SSRN.
Bolton, Patrick, Hui Chen, and Neng Wang. Annual Review of Financial Economics. Forthcoming.
Chen, Hui, Ali Kakhbod, Maziar Kazemi, and Hao Xing, MIT Sloan Working Paper 6927-23. Cambridge, MA: MIT Sloan School of Management, May 2024.
Chen, Hui, Winston Wei Dou and Leonid Kogan. Journal of Finance Vol. 79, No. 2 (2024): 843-902. SSRN Preprint.
Chen, Hui, Anton Petukhov, Jiang Wang, and Hao Xing. The Journal of Finance Vol. 79, No. 2 (2024): 1405-1455. SSRN Preprint.
He Sun, Zhun Deng, and David C. Parkes. In Proceedings of the Fourth ACM International Conference on AI in Finance, New York, NY: November 2023. arXiv Preprint.
Circuit breakers are meant to calm the markets. But new research shows that they can backfire and create more volatility if not properly designed.
"Large, superstar firms have really long lasting power. This gives them room for what we call collusive competition or implicit collusion."
“Their analytical advantage is most significant with this mass market, where traditional banking models are most inaccessible.”
“AI technologies are everywhere in Ant's business. They can make loan decisions within minutes and with zero involvement of human bankers."
