Topic: The Real Effects of Market Inefficiency: Aggregate versus Cross-Sectional Mispricing
Speaker: Huafeng (Jason) Chen, Associate Professor of Finance, Mays Business School, Texas A&M University
Date: March 6th (Fri.)
Time: 10:00-11:30am
Location: Building 4, Room 101
Language: English
Abstract:
We study the real cost of market inefficiency. We distinguish two types of market inefficiency: aggregate and cross-sectional mispricing. We argue that the real cost of cross-sectional mispricing is more severe than that of aggregate mispricing. The reason for a relatively small consequence of aggregate mispricing is that the wealth effect and the substitution effect tend to offset each other.
About the speaker:
Huafeng Chen is Associate Professor at Mays Business School, Texas A&M University. He obtained both his MBA and Ph.D. from University of Chicago. His research has been published on several leading financial journals, such as Journal of Finance, Journal of Financial Economics, and Review of Finance. He was awarded the Chartered Business Valuators Award for the Best Paper on Business Valuation at the Northern Finance Association meeting and Sp?ngler IQAM Prize for Best Paper in the Review of Finance (runner-up) in 2012.
