Press Release

Center for Financial Studies awards 5th Deutsche Bank Prize in Financial Economics 2013 to Raghuram G. Rajan

  • Chicago Booth professor receives prize for highly influential contributions in are markably broad range of areas in financial economics
  • Prize to be presented as part of academic symposium on 26 September 2013
  • Jury Chairman Michael Haliassos: “Raghuram G. Rajan’s work develops novel empirical and theoretical approaches with significant policy implications.”

Frankfurt, 6 February 2013 – The Center for Financial Studies (CFS) has awarded the 5th Deutsche Bank Prize in Financial Economics 2013 to the Indian economist Raghuram G. Rajan for his highly influential contributions in a remarkably broad range of areas in financial economics. Jury Chairman and CFS Director Michael Haliassos summarized the view of the international Jury: “Raghuram G. Rajan’s work spans a remarkably broad range of areas in financial economics most important to the development of economies worldwide. This includes the impact of financial development on growth, banking and financial crises, as well as corporate finance and governance. His work develops novel empirical and theoretical approaches with significant policy implications.”

The academic prize is sponsored by the Deutsche Bank Donation Fund and carries an endowment of €50,000. The CFS awards the prize biennially in partnership with Goethe University Frankfurt. The prize will be presented to Raghuram G. Rajan as part of an academic symposium in Frankfurt on 26 September 2013. The Deutsche Bank Prize in Financial Economics honors internationally renowned economic researchers whose work has a marked influence on research concerning questions of financial economics and macroeconomics, and has led to fundamental advances in economic theory and practice.

An original thinker with outstanding contributions to theory and practice

Raghuram G. Rajan’s broad research interests include banking, corporate finance, and the role of finance in economic development. He is one of few economists who warned the world about the financial crisis that eventually broke out in 2008.

Rajan’s penetrating analysis of the changing growth experience during the postwar era and of the differences in the nature of the crises faced by the United States and by Southern Europe is essential reading for understanding the current policy dilemmas between austerity and growth facing both sides of the Atlantic. Rajan argued forcefully the futility of excessive spending, the need to focus on sustainable long-term growth in designing short-term measures, and the importance of not forgetting to provide for those most adversely hit by austerity, such as the poor, the young, and the elderly.

His recent book, “Fault Lines: How Hidden Fractures Still Threaten the World Economy”, won the Financial Times Business Book of the Year award in 2010. Rajan analyzed the complex interactions between the financial industry, politics, and society, focusing on the role of income inequality in the United States in creating an environment in which financial excesses were tolerated. He demonstrated how rational choices by individuals collectively brought down a flawed financial system.

Raghuram G. Rajan is the Eric J. Gleacher Distinguished Service Professor of Finance at the University of Chicago’s Booth School of Business. He serves as Chief Economic Adviser in the Finance Ministry, Government of India. Previously, he was Chief Economist at the International Monetary Fund (2003 - 2006). Raghuram G. Rajan was the President of the American Finance Association in 2011 and is a member of the American Academy of Arts and Sciences. In January 2003, the American Finance Association awarded him the inaugural Fischer Black Prize, given every two years to the financial economist under age 40 who has made the most significant contribution to the theory and practice of finance.

International Jury and renowned academic prize

A Jury of internationally renowned experts in financial research and practice decides on the recipient of the Deutsche Bank Prize in Financial Economics. Members of the international Jury, alongside the Chairman Michael Haliassos, include (in alphabetical order) Professors Ricardo Caballero (Massachusetts Institute of Technology), David Folkerts-Landau (Deutsche Bank’s Group Chief Economist, Global Head of Market Research and member of the Group Executive Committee), Nicola Fuchs-Schündeln (Goethe University), Otmar Issing (CFS President) and Jan Pieter Krahnen (CFS Director). Furthermore, the Jury includes Robert C. Merton (Nobel Prize Winner; Massachusetts Institute of Technology), the winner of the Deutsche Bank Prize in Financial Economics 2011, Kenneth Rogoff (Harvard University), Raman Uppal (EDHEC Business School) and Uwe Walz (CFS Director).

The prize was awarded for the first time in 2005 to Eugene F. Fama, Professor of Finance at the University of Chicago, for researching the concept of individual rationality in financial market behavior. In 2007 Michael Woodford, Professor of Political Economy at Columbia University, received the prize for his groundbreaking redefinition of monetary analysis. In 2009 Robert J. Shiller, Professor of Economics at Yale University and Professor of Finance at Yale School of Management, received the prize for his constructive challenge of rationality and promotion of behavioral considerations. Kenneth Rogoff, Professor of Economics and Professor of Public Policy at Harvard University in Cambridge, USA, received the prize in 2011 for his analysis of financial crises.

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