Chicago Booth professor honored by European Finance Association

Michael Weber, assistant professor of Finance and Neubauer Family Faculty Fellow at the University of Chicago Booth School of Business, received two awards from the European Finance Association at its 41st annual meeting in Switzerland.

Weber's paper "Nominal Rigidities and Asset Pricing" was named UBS Best Conference Paper and European Finance Association Best Doctoral Student Conference Paper — the first time a doctoral paper won the Conference Paper Prize.

"The awards are a great recognition and it feels fabulous that the most esteemed colleagues in the profession recognize and value my work," Weber says.

"This is a very competitive process, with about 2,000 initial paper submissions, about 700 members of the Program Committee, and about 200 papers presented in 70 sessions," says Pradeep Yadav, European Finance Association chair and University of Oklahoma Price College of Business W. Ross Johnston chair and finance professor. "The European Finance Association warmly congratulates Michael Weber on his truly outstanding achievement."

Weber looked at the effects that having rigid output prices has on firm risk, finding that infrequent adjustments can lead to higher returns because of greater volatility.

"Price stickiness therefore has real costs for firms; it increases the cost of capital, and firms might forgo profitable investment projects," he writes. "The frequency of product-price adjustment is a simple variable at the firm level that can account for a considerable part of the variation in firms' exposure to systematic risk."

"Nominal Rigidities and Asset Pricing," written while Weber was a doctoral candidate at the University of California at Berkeley's Haas Business School, also earned him a Top Finance Graduate Award 2014 from the Center for Financial Frictions and the Department of Finance at Copenhagen Business School, as well as the Best Ph.D. Student Paper Award at the FMA European Conference 2014.

"Sticky prices have a long history in such different fields as macroeconomics, industrial organization and marketing," Weber says. "My findings have the potential to further bridge macroeconomics and finance and open avenues to bring insight from finance to industrial organization, and vice versa."

Weber, who is in his first year teaching at Booth, also won the AQR Insight Award 2013 for his paper "Conditional Risk Premia in Currency Markets and Other Asset Classes," forthcoming in the Journal of Financial Economics, along with two co-authors from Berkeley.

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From: Ethan Grove, Chicago Booth Office of Media Relations, 773.834.5161 (office), 773.420.8670 (cell), Ethan.Grove@chicagobooth.edu