Seeking to blend the studies of economics and finance,
Johns Hopkins has established the
Center for Financial Economics, an innovative,
comprehensive new program that ultimately will offer an
undergraduate minor and major and train graduate students
in financial economics, said Adam Falk,
the James B. Knapp Dean of the Krieger School of Arts and
Sciences.
The Center for Financial Economics, housed within the
Department of
Economics, will provide
sound and rigorous training in economics and finance and
demonstrate how the two facets of the
economy are integrated. The Krieger School is officially
launching the CFE this fall, naming economics
professor Jon Faust as its inaugural director.
Faust, who joined the Krieger School's Economics
Department in 2006, is an accomplished
scholar and a leader in the field of finance with nearly 20
years of experience in the Federal Reserve
System, most recently as assistant director of its
international finance division. Falk said Faust is
"perfectly positioned" to lead the CFE.
"His appointment as director will allow us to emerge
into an exciting period in which we realize
our vision for the Center for Financial Economics," Falk
said.
Of Faust's appointment, Joseph E. Harrington, chair of
the Department of Economics, said, "Jon
is uniquely qualified, as his knowledge and understanding
of financial markets is rooted both in a
distinguished research record and his experience at the
Federal Reserve Board of Governors in
dealing with the functioning of financial markets. In the
Federal Reserve System, he was at the nexus
of research and policy, and this experience is a terrific
background for developing the CFE."
Faust said he is excited to help launch this endeavor.
"It's a really great opportunity to get an
important institution off on the right foot," he said. "I
think the CFE is a fabulous idea, and there will
be a tremendous amount of student interest in it."
The center is founded on the principle that knowledge
of neither finance nor economics by
itself is sufficient to understand financial markets and to
operate within them. While a similar
educational approach is used by at least one other
university — Princeton offers an undergraduate
certificate in finance — Harrington said that the CFE
will go further by first developing a minor, and
eventually offering a major and a PhD, in financial
economics.
"It is our goal that students who graduate from Johns
Hopkins with this training will find
themselves better tooled with a more complete understanding
of financial markets than graduates of
any other university," Harrington said. "This edge will
serve their personal interests, as they will be
more attractive in the job market, and societal interests,
as they will be better equipped to make
sound economic and financial decisions."
Course work will include macroeconomics,
microeconomics, corporate finance, investments and
portfolio management and will incorporate some courses
currently offered in the Department of
Economics by faculty members Laurence Ball, Stephen Shore,
Tiemen Woutersen and others. When
fully funded, the CFE will comprise four faculty members,
including the inaugural Carl Christ
Professor, for whom a search is under way. Christ, a
professor emeritus in the Department of
Economics, is an award-winning teacher and influential
scholar in the field of econometrics, having
written three books and more than 100 articles and other
publications. Fund raising for the center is
ongoing.
The Center for Financial Economics is getting its
start less than a year after the university's
establishment of the Carey Business School, and Krieger
School officials foresee opportunities to
build a complementary and mutually supporting relationship,
Falk said.
Former department chair Louis J. Maccini, who led the
efforts to establish the CFE, said that
the integration of finance and economics will benefit both
research and teaching. "From a research
perspective, the center will enable faculty and doctoral
students to share ideas and develop new
insights on how financial markets operate in the economy as
a whole," he said. "From a teaching
perspective, the programs will provide students with depth
in both finance and economics and with
breadth in quantitative and communication skills that can
best be accomplished in the context of a
liberal arts education in a school of arts and sciences.
This training will be advantageous to students in
seeking jobs in finance and more broadly in achieving an
education that will benefit their lives."
Faust will teach courses at the undergraduate and
graduate levels that focus on financial
markets and their role in the macro-economy. He holds a
bachelor's degree in economics from the
University of Iowa, a master's degree from Oxford
University and a doctorate from the University of
California, Berkeley. An ongoing adviser to the Federal
Reserve Board, Faust consults regularly with
central banks throughout the world and has held visiting
faculty positions at Princeton and Georgetown
universities and at the Center for Applied Economics and
Policy Research at Indiana University.
Faust is widely published in scholarly journals on a
broad range of topics at the intersection of
finance and macroeconomics, including isolating mechanisms
through which derivative securities could
cause disruptions in financial markets, and documenting
patterns in the high-frequency response of
financial markets to macroeconomic announcements. He is
currently editor of the Berkeley Journals in
Macro and associate editor of the Journal of Business
Economics and Statistics, and he serves on the
National Science Foundation's economics panel.