University of Chicago professor Lars Hansen, 2013 Nobel laureate in economic sciences, to highlight Purdue Presidential Lecture on Oct. 17
WEST LAFAYETTE, Ind. — Nobel laureate Lars Peter Hansen, a leading expert at the forefront of economic thinking and asset-price modeling, will join Purdue University President Mung Chiang this month as keynote for the next edition of the university’s Presidential Lecture Series.
Hansen, the David Rockefeller Distinguished Service Professor in Economics and Statistics at the University of Chicago, shared the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel in 2013 with University of Chicago colleague Eugene Fama and Robert Shiller of Yale University. They were recognized for their groundbreaking research on the workings of financial markets, asset prices and behavioral economics.
Hansen’s Presidential Lecture appearance, titled “Uncertainty in Our Scientific Inputs Into Policy: Disguise It or Embrace It?” is at 6 p.m. Thursday, Oct. 17, in the Purdue Memorial Union’s North Ballroom. The event is free and open to the public, but a general admission ticket will be required.
“Professor Hansen is a leading expert in economic dynamics who works at the vanguard of macroeconomics, finance and econometrics, shaping our understanding of asset pricing and how economists model complex financial markets,” Chiang said. “What an honor this will be for our Purdue and Greater Lafayette communities to hear timely insights from one of the brightest business minds of our time whose research and scholarship have made fundamental advances in our understanding of how economic agents cope with changing and risky environments.”
Drawing on his background in math and statistics, Hansen has contributed to the development of statistical methods designed to explore the interconnections between macroeconomic indicators and assets in financial markets — methods now widely used in empirical research in financial economics.
The Nobel committee said the work by Hansen, Fama and Shiller “laid the foundation for the current understanding of asset prices.”
Born in Urbana, Illinois, Hansen studied mathematics and political science at Utah State University, where his father was a biochemistry professor. He received his PhD in economics from the University of Minnesota in 1978, worked at Carnegie Mellon University in Pittsburgh from 1978-81, and then moved to the University of Chicago, where he has worked ever since.
His early research in econometrics was aimed at developing time series statistical methods to investigate one part of an economic model without having to fully specify and estimate all the model ingredients. The applications he explored with several co-authors — such as Kenneth Singleton, Scott Richard, Robert Hodrick and Ravi Jagannathan — included systems that are rich enough to support models of asset valuation and to identify and clarify empirical puzzles where real-world financial and economic data were at odds with prevailing academic models.
Over the last several years, Hansen, Nobel laureate Thomas Sargent and their co-authors have developed methods for modeling economic decision-making in environments in which uncertainty is hard to quantify. They initially explored the consequences for models with financial markets, characterizing environments in which the beliefs of economic actors are fragile. In his most recent work, Hansen and co-authors investigated uncertainty implications for the design of prudent climate and other economic policies.
“While uncertainty is unavoidable and pervasive in our lives, in many discussions of economic analysis and policy, it unfortunately takes a back seat,” Hansen said recently. “We should instead push uncertainty to the forefront of our thinking.”
In addition to the Nobel prize, Hansen won the 2010 BBVA Foundation Frontiers of Knowledge Award in Economics, Finance and Management; the CME Group-MSRI Prize in Innovative Quantitative Applications in 2008; and the Erwin Plein Nemmers Prize in Economics from Northwestern University in 2006. Hansen and Singleton, a Stanford University economist, were awarded the Frisch Medal from the Econometric Society in 1984 for their paper “Generalized Instrumental Variables Estimation of Nonlinear Rational Expectations Models.”
Hansen is a fellow of the National Academy of Sciences and the American Finance Association and also is a member of the American Academy of Arts and Sciences and past president of the Econometric Society. He is a member of the Hong Kong Institute for Monetary and Financial Research Council of Advisers for Applied Research, and the CME Group Competitive Markets Advisory Council.
Hansen has received numerous honorary degrees, including an honorary doctorate from Utah State in 2012.
About the Presidential Lecture Series
Launched in 2014 by then-Purdue President Mitch Daniels and continued by President Mung Chiang, the Presidential Lecture Series exposes Purdue students and the broader community to inspiring ideas, courageous leadership and models of civic engagement and civil discourse. The Presidential Lecture Series has had over 40 guests of many viewpoints and perspectives and hosted some of the great intellectual, business and civic leaders of our time. As one of the world’s premier centers of scholarly leadership, Purdue is — appropriately and necessarily — a regular venue for great thinkers across a wide variety of disciplines.
About Purdue University
Purdue University is a public research institution demonstrating excellence at scale. Ranked among top 10 public universities and with two colleges in the top four in the United States, Purdue discovers and disseminates knowledge with a quality and at a scale second to none. More than 105,000 students study at Purdue across modalities and locations, including over 50,000 in person on the West Lafayette campus. Committed to affordability and accessibility, Purdue’s main campus has frozen tuition 13 years in a row. See how Purdue never stops in the persistent pursuit of the next giant leap — including its first comprehensive urban campus in Indianapolis, the Mitch Daniels School of Business, Purdue Computes and the One Health initiative — at https://www.purdue.edu/president/strategic-initiatives.
