About 50 students from universities across the United States and Europe gathered at the Yale School of Management for 2022 Yale Summer School of Behavioral Finance June 13-17.
The one-week program is an intensive doctoral course in behavioral finance led by Yale SOM faculty members who are leading practitioners in this growing field. The program, which is held every two years, attracts PhD students in the fields of finance and economics.
“This is the seventh Summer School we have held, and we are delighted that it has become a major event in the world of academic finance,” said organizer Nicholas Barberis, Stephen and Camille Schramm Professor of Finance. “More than 300 students have participated in this program over the years, and many of them have gone on to do excellent research of their own in this area.”
In addition to Barberis, this year’s Yale SOM faculty is involved Kelly Shue (above) and James Choi, both professors of finance. Five additional teachers from other schools also taught.
“We run the program because there is a growing sense among many of us that ideas from behavioral finance are critical to understanding important financial phenomena, such as bubbles and crashes, stock market fluctuations, household investment mistakes, and the behavior of firm managers,” Barberis said.
And while there has been a lot of research in the field, not many schools offer courses in behavioral finance, Barberis said. “Yale SOM has historical strength in this area,” he added. “Modern behavioral finance began here at Yale, through the seminal work of Robert Shiller, and many of us have continued this tradition.”
Attendee James Paron, a doctoral student at the Wharton School of Business, said some understanding of the behavioral aspects of finance today is “essential.” “It’s going to be an area of massive research going forward,” said Paron, whose research focuses on asset pricing and macroeconomics.
“Nick [Barberis] is a leader in the field and someone I wanted to learn from,” said Paron. “External speakers are also not only knowledgeable about finance, but also have interesting different perspectives.”
Kristen Burr, a first-year doctoral student at Columbia University, also called the behavioral approach a key tool today. “It’s quite important to consider the role that psychology plays when people make decisions,” she said. “I have the advantage of being in finance at a time when behavioral finance is coming into its own.”
Burr said the balanced structure and pace of the Summer School program helps students digest the material.
“I’m surprised at how much I’ve been able to carry,” she said. “This is such a phenomenal opportunity at the beginning of my PhD to interact with professors whose work I’ve read and to network with people who are thinking about the same kinds of problems as me.”
A behavioral finance summer school was created at Yale made possible by the generous support of the Lynne and Andrew Redleaf Foundation.