research interests and representative publications

I view finance as a field analyzing the allocation of risk in society. Risks have direct effects on economic agents, as well as indirect effects that exist because agents are affected by other agents' responses to risks. The existence of indirect effects often complicates the measurement of the direct effect.

I've analyzed various types of risk: weather risk, competitive risk, and political risk. Below, I classify my research according to these types of risk. An alternative classification could be based on industry focus. In this respect, I have focused on tourism, but I've also used data about electricity generation.

The German politician Ralph Brinkhaus once asked me about the "political imperatives" that follow from my research. Some of my academic research projects indeed happened to lead to insights that are relevant for policy-making. I summarize these insights on a separate page. I've also had some opportunities to conduct policy analyses sponsored by government agencies or think-tanks. For more information about these projects, see the page "policy work".

Weather risk
is a risk factor with relatively clear-cut direct effects. My research analyzes effects of weather risk on the Austrian tourism industry. This risk is a risk of demand shocks. It mainly affects family-owned businesses and their bank creditors. The direct effects depend on the capital structure of the businesses, while indirect effects are associated with banks' responses to weather shocks. I've analyzed both types of effects in two papers that appeared in The Review of Financial Studies.
Competitive risk is risk associated with competitor behavior. I'm particularly interested in situations in which a firm's risk exposure depends on the way competing firms respond to risk factors. My work analyzes how competitive risk affects' firms' owners and employees, as well as their creditors.
Political risk is a new research interest of mine. A recent paper analyzes effects of political instability on government-owned banks, based on data about Austrian municipally-owned savings banks. We find evidence that the banks' lending to their owners was used to transfer revenues from the banks to the governments. Some of the evidence is particularly pronounced in localities where the incumbent politicians face significant competition for reelection. [link to the paper]