Centers & Initiatives
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 Dou, and Leonid Kogan. The Journal of Finance. Forthcoming. SSRN Preprint.
Chen, Hui, Zhuo Chen, Zhiguo He, Jinyu Liu, and Rengming Xie, MIT Sloan Working Paper 5705-18. Cambridge, MA: MIT Sloan School of Management, November 2021.
Chen, Hui, Zhiyao Chen, and Jun Li, MIT Sloan Working Paper 6526-21. Cambridge, MA: MIT Sloan School of Management, October 2021.
Chen, Hui, Yu Xu, and Jun Yang. Journal of Financial Economics Vol. 139, No. 3 (2021): 770-799. Download Paper.
Chen, Hui, Scott Joslin, and Sophie Ni. Review of Financial Studies Vol. 32, No. 1 (2019): 228-265. Download Paper.
“Their analytical advantage is most significant with this mass market, where traditional banking models are most inaccessible.”