As an undergraduate student at the University of New South Wales, Eddie Gandevia started and sold a tech company that developed learning tools for high school students in Australia.

Intrigued by the social impact the company made on the lives of students, teachers and parents, Gandevia, MBA 17, hopes one day to run an investment firm that helps build businesses in developing nations to accelerate development and alleviate poverty.

Gandevia’s conviction that businesses have a key role in helping emerging countries to build a strong middle class helped land him a Fellowship in Entrepreneurial Finance at Haas.

He was one of nine first-year full-time MBA students to receive fellowships earlier this month, including:

• Ricky Tan and Leah Staub-DeLong, who were also awarded Entrepreneurial Finance Fellowships.
• Mike Fagan, Nathan Feltz, and Rohan Reddy, who received the Investment Banking Fellowship.
• Julia MacDonald, Claudia Silva, and Jason Van Thiel, who received Investment Management Fellowships.

Standing L-R:  Michael Fagan, Jason Van Thiel, Eddie Gandevia, Rohan Reddy, Julia MacDonald, Nathan Feltz
Sitting: Peter Stilwell, Claudia Silva, Ricky Tan, Leah Staub-DeLong
Missing: Lizzie Faust and Hajime Shimazu
 

The recipients join three other first-year Full-time MBA students who were named CJ White Fellows in Finance earlier this year: Lizzie Faust, Hajime Shimazu, and Peter Thomas Stilwell.

Together, the fellowships recognize aspiring business leaders who demonstrate strong career goals and symbolize Berkeley-Haas values. In addition to a cash award, recipients are also matched with mentors who work in their chosen field and are given priority when signing up for finance electives.

Reddy says the most exciting aspect of his fellowship is the connection he’s already made with his mentor, Landon Mizuguchi, MBA 14, a 2012 fellow who is now an associate with an investment bank in San Francisco.

“The program connects you to a person who’s living the life you aspire to, who can offer you insight from the inside, and who understands what Haas is all about,” he says.

Gandevia has high hopes for his mentorship, too. “I’m looking forward to sitting at the feet of someone who is trying not just to be successful within the system, but is trying to shift the system to the benefit of the rest of the world,” he says.

For Gandevia, the fellowship reaffirms why he chose Haas. “The school is a leader at the intersection of profit and purpose,” he says.

“Haas really is re-shaping the role of business in society.”

Students from eight top MBA programs will be using data to solve a business problem in a socially responsible way for Facebook at the 5th annual Haas Tech Challenge Case Competition.

This year’s Berkeley Haas Tech Challenge, sponsored by Facebook and organized by the Haas Technology Club, will be held on November 6-7 at Berkeley-Haas.

Positioned as a "hackathon for MBAs," the competition allows students to tackle real-world business challenges, gain hands-on experience in the technology industry, and network with leading technology companies.

Tim Campos, (pictured), Facebook’s CIO and BCEMBA 11, will be among this year’s judges, along with directors of the Fisher CIO Leadership Program and Berkeley-Haas faculty members.

“This competition is a great opportunity for students to gain a real-world understanding of some of the business challenges companies like Facebook encounter,” Campos says. “We’re excited to partner with Berkeley-Haas on this competition, and look forward to hearing all of the proposed business solutions from the students."

Facebook, in close collaboration with case writer Laura Burkhauser, MBA 16, and Adj. Prof. Andrew Isaacs, director of New Management of Technology Programs at Haas, provided the case for this year’s competition.

“We’re so excited to bring Facebook to campus this year and shake things up with a business challenge that comes directly from the company,” said Ariana Alisjahbana, who with Claire Bianchi, both MBA 16, is co-chairing the event for the Haas Tech Club. “We were very impressed by the caliber of contestants this year,” Bianchi added.

Students will spend 14 hours working non-stop to solve the case and draft their solution.  All eight teams will be given a chance to tour Facebook’s headquarters the day before the competition.

The 1st-place team will receive $5,000; the runner-up wins $3,000; and the 3rd-place team wins $1,000. Dean Lyons will announce the winners with Campos on Nov. 7.

Previous competition sponsors include Intel, Dell Computer, Booz Allen Hamilton, Gap, IBM, GE, and VMWare.

The Berkeley-Haas Center for Responsible Business has awarded its 2015 Moskowitz Prize to a paper by University of Geneva Asst. Prof. Philipp Krüger that found the stock market values companies that are mandated to report greenhouse gas emissions and that these effects appear to be strongest in carbon-intensive industries.

Krüger, (pictured), an assistant professor of responsible finance at the University of Geneva and junior chair of the Swiss Finance Institute, accepted the prize at the 25th annual Socially Responsible Investing (SRI) Conference in Colorado Springs, Colo. on Nov. 4.  He is the author of the winning 2015 study: Climate Change and Firm Valuation: Evidence from a Quasi-Natural Experiment.

Presented by the Center for Responsible Business at Berkeley-Haas since 1996, the Moskowitz Prize is the only global award that recognizes outstanding quantitative research in socially responsible investing.

Krüger’s paper examines the impact of a new mandatory Greenhouse Gas (GHG) Emissions Disclosure Act passed into law in the United Kingdom in 2013. The law applied to firms listed on the Main Market of the London Stock Exchange, and now requires that every UK company report comprehensive data on their GHG emissions in their annual reports. The UK is the first country to introduce mandatory carbon reporting for publicly listed firms.

For his control group in this study, Krüger picked firms within other European exchanges that matched the size and industry of the UK firms. His study found that the firms most heavily affected by the regulation experienced “significantly positive valuation effects,” when compared to the European companies in his control group.

Lisa R. Goldberg, an adjunct professor in UC Berkeley’s Department of Statistics and director of research at the Center for Risk Management Research, said the paper “supports the hypothesis that markets value transparency regarding corporate climate change risk.”

“This fascinating, rigorous, and beautifully written article makes an important contribution to the field of sustainable investing and will serve as a model for future research in this subject,” she says.

Nadja Guesnter, professor of international financial management at the Muenster School of Business and Economics at the University of Muenster in Germany and a visiting faculty fellow at Berkeley-Haas, said the study “moves us forward by showing that we are not just looking at correlations.”

“Using a unique setting, the introduction of new carbon disclosure rules in the UK, his work provides evidence of causality between environmental disclosure and firm value,” she says. “His work shows that not only voluntary environmental disclosure, but even mandatory environmental disclosure required by law has a positive effect on firm valuation.”

Judges from both academic and investment circles reviewed 40 papers. The papers were judged on the practical significance to practitioners of socially responsible investing, appropriateness and rigor of quantitative methods, and novelty of results.

The Prize is named for Milton Moskowitz, one of the first investigators to publish comparisons of the financial performance of screened and unscreened portfolios, including “The 100 Best Companies to Work for in America.” Sponsors for the Prize include Calvert Group, First Affirmative Financial Network, Nelson Capital Management, Neuberger Berman, Rockefeller and Co., and Trillium Asset Management.

See the full paper.

Joseph Jimenez, MBA 84, the CEO of Novartis AG who has positioned the company to anticipate future health care trends and to make momentous strides against various forms of cancer, will be honored as Business Leader of the Year at the 14th Annual Haas Gala on November 13.

The award recognizes members of the Berkeley-Haas community who have achieved prominence in their fields.

Since assuming the helm of Novartis in 2010, Jimenez, (pictured), whose expertise was previously in corporate marketing and consumer goods, has streamlined the largest company in Europe by market value to focus solely on pharmaceuticals, eye care, and generics. Last year, the Basel, Switzerland-based company saw net sales of $58 billion USD, and Jimenez has committed billions to research and development. Novartis currently has over 25,000 patients enrolled in 340 active global trials for promising cancer therapies.

Jimenez’s leadership and vision to solve one of the world’s most formidable challenges have earned him Berkeley-Haas’ highest honor. Previous recipients of the Business Leader of the Year Award include Janet Yellen, Haas professor emeritus and chair of the Federal Reserve, and Paul Otellini, MBA 74, the former CEO of Intel.

“Though not a scientist, Joe was an inspired choice to run a pharmaceutical giant,” says Rich Lyons, dean of Berkeley-Haas. “It’s his analytical skill at balancing short- and long-term goals, his quiet drive, and his outstanding ability to nurture the right talent that have allowed him to Question the Status Quo and re-envision the industry. He has the confidence and expertise to lead Novartis to deliver where society needs it most and is an example for us all of our Defining Principles.”

Read more about Jimenez, his influence on the pharmaceutical industry, and his connections to Berkeley-Haas.

Three other alumni will also receive awards at the Gala. Danae Ringelmann and Eric Schell, MBA 08s, will receive the Leading Through Innovation Award. The duo propelled the crowdfunding movement when they launched Indiegogo, one of the first crowdfunding sites, with co-founder Slava Rubin in 2008. (Kickstarter, Indiegogo’s chief rival, launched a year later.)

Ringelmann and Schell (pictured),  began working on Indiegogo while Berkeley-Haas students and used their Haas connections to develop the company. To date, Indiegogo has hosted over 300,000 campaigns in 224 countries and territories.

And the company’s growth has been exponential. Funds raised on the site in the past two years have increased 1,000 percent. Crowdfunding itself has disrupted the world of finance. Forbes reports that in 2010, global crowdfunding was an $880 million  business. In 2014, that figure rose to $16 billion and is estimated to more than double this year to upwards of $34 billion.

Read about Ringelmann and Schell and how they’ve revolutionized an industry.

Also at the Gala, the annual Raymond E. Miles Service Award will be presented to Lucky Sandhu, BS 96, MBA 15, the president and co-Founder of Reliance Financial. Sandhu has long been a committed volunteer for Berkeley-Haas, serving on the Berkeley-Haas East Bay Chapter Board of Directors since 2007. He led the chapter as co-president from 2009 to 2011, when it twice won the Chapter of the Year Award.

The event, to be held at the Westin St. Francis Hotel in San Francisco, will kick off with a reception at 6:30 p.m., followed by dinner, an awards presentation, and a dessert reception.

Professor Annette Vissing-Jorgensen has won the Swiss Finance Institute’s Outstanding Paper Award for a study on how government debt crowds out financial sector short-term debt, the institute announced today. She shares the prize with her co-author Professor Arvind Krishnamurthy of Stanford University.

The SFI’s prize recognizes unpublished research papers expected to make an outstanding contribution to the field of finance.

In their paper, The Impact of Treasury Supply on Financial Sector Lending and Stability, Vissing-Jorgensen (pictured), and Krishnamurthy argue that one of the main drivers in the quantity of short-term financial debt made available is the non-financial sector’s willingness to pay a premium for safe and liquid assets. The financial sector—banks in particular—makes a profit by holding illiquid and risky assets, and issuing liquid and risk-free claims against these assets.

Empirical evidence shows that the quantity of financial sector short-term debt falls when there are more outstanding government securities; government securities crowd out financial sector short-term debt, because both securities are perceived as similar by households.

These results are consistent with the viewpoint that the shadow banking system played an important role in the production of safe and liquid assets during the past decade. Further computations show that these results are probably not due to the standard macro mechanism in which government supply crowds out private capital formation by raising real interest rates.

A lesson of the paper for banks is that government actions, such as borrowing or quantitative easing, can affect banks’ funding conditions. The magnitude is large: a one-dollar increase in government debt depresses financial sector debt used to fund risky, liquid investments by 50 cents.

A lesson of the paper for governments is that their actions, by affecting the amount of maturity transformation in the banking sector, can affect the systemic risk of banking.

The winners of the SFI Outstanding Paper Award 2015 will be invited to present their research at a prize-giving ceremony in Switzerland in the course of 2016.

The Swiss Finance Institute (SFI) is a private foundation created in 2006 and supported by the Swiss banks, the Swiss Stock Exchange, leading Swiss universities and the Swiss federal government. SFI supports and advances research, doctoral training, knowledge transfer and education in banking and finance. It fosters interaction between researchers and practitioners to ensure an integrated approach to finance research.

Three Berkeley-Haas leaders have made the 2015 Thinkers50 global ranking of management pioneers: Lecturer Steve Blank, (#20), Adj. Prof. Henry Chesbrough, (#24) and Affiliated Prof. Morten Hansen (#34).

Blank, who is credited with launching the Lean Startup Movement, debuted on the list this year. Chesbrough has made the list four times for his work on Open Innovation.

Hansen, co-author of Great by Choice (with Jim Collins, 2011), is on the list for the third time.

The Thinkers50 global ranking of management thinkers is published every two years. Thinkers50 launched in 2011 and has been described by the Financial Times and others as the “Oscars of management thinking.”

The Big Give 24-hour campus-wide online fundraising blitz, kicks off on Wednesday, Nov. 18, at 9 p.m. PST—and Haas is aiming to beat its 2014 results.

During last year's inaugural Big Give, Berkeley-Haas raised $561,000 from 651 donors campus-wide. Overall, Big Give donors contributed $5.3 million, in the form of 7,336 gifts, to support students, faculty, and campus programs.

This year's fundraiser, themed "Think Bigger," includes competitions that foster friendly rivalry between Berkeley schools and departments based on most money raised as well as highest participation rates. Individual donors can also compete by posting creative photos—including pets and babies—on social media.

“Haas had a fantastic turnout at last year’s Big Give and we’re hoping that everyone is gearing up to top that at this year’s fundraising event,” said Michelle McClellan, assistant dean of Berkeley-Haas Development & Alumni Relations. “Big Give is a perfect way to show support for our programs, students, and faculty and bring attention to the important role philanthropy plays in keeping Haas a top-ten school.”

To spread the word, Berkeley-Haas Dean Rich Lyons grabbed his acoustic guitar and recorded a music video on campus. The full video is here!

The central campus produced a video based on the "Think Bigger" theme, which features students, alumni, and faculty members.

Big Give contests include:

• Big Slice: Schools and programs that raise the most money during the Big Give get the biggest pieces of the pie.

• Big Bang: Schools and programs with the highest donor participation rate during the Big Give win big prizes.

• Big Countdown: Hour-long contests in a variety of categories.

Posting about the Big Give on social media? Use the #CalBigGive and #haasome hashtags together. Have questions about donating? Click here.

By Krysten Crawford

The soulful sounds of Amy Winehouse’s “Rehab” reverberated through Cheit 125 as second-year MBA students filed in on a recent Monday for Prof. John Morgan’s Game Theory class.
 
For nine weeks now, the 65 students enrolled in the elective course have been participating in a game modeled after the CBS reality show “Survivor.” Of the 14 original teams, only six were still in the running.

Just as on TV, Morgan’s contest features a series of teams competing weekly to win a game—minus the sleep and food deprivation and exotic locales. In Morgan’s version, each game mirrors a real-world business challenge, including basketball free agency, radio spectrum auctions, online retailing, and legislative lobbying.

The team with the highest score each week gets immunity, while losing teams duke it out in “tribal council” to see which one would get voted out of the competition in a secret ballot.

Morgan, who has taught Game Theory, or the science of strategy, at Haas for 11 years, has long relied on team competitions within his class. But it wasn’t until last year that, at the suggestion of his then-11-year-old son, he combined the games into a semester-long contest modeled after “Survivor.”

His goal, he says, is to teach students to be “outward thinkers.” By that, he means to show them that they need to be able to relate to others to succeed in business. “You don’t really learn how to empathize by having some professor tell you about the need to empathize. It’s like a reading a self-help book. It doesn’t work. You actually have to do it.”

Fragile vs resilient

On this day, Morgan’s game was about to take a dramatic turn. The theme of this late October class was “Redemption Island.” As the name suggests, one team that had previously been given the boot would be given a second chance.

That team—called WITS Going Down! (WITS stands for "Walk in Their Shoes," an acronym Morgan uses to promote the use of outward thinking)—had excelled at the weekly challenges, but stumbled badly when it came to the behind-the-scenes maneuvering, where personality often trumps performance.

The team recovered quickly, and spent the intervening weeks when it was officially out of the competition building the kind of alliances that led to its redemption.

WITS Going Down seemed to have figured out that, to win, its strategy didn’t need to be perfect. “Perfect-but-fragile strategies,” says Morgan, “are less good than mediocre-but-resilient strategies.”

Getting to the final round

Here’s how “Survivor: Game Theory” has worked during the course: 14 teams started the semester split evenly into two camps, named after Nobel Prize winners in economics: House Harsanyi (the Haas School’s own Nobelist) and House Vickrey.

After each competition, all members of the house with the best-performing team were guaranteed to make it to the next round. The teams in the losing house then convened in an end-of-the-week “Tribal Council,” run by Morgan’s assistant Sibo Lu, to talk through which one of their own to vote off.

Through a process of elimination, three teams will make it to the final round in December. At that point, all 14 teams will get to decide which of the three wins the entire game. Each member of the winning team gets $100 (out of Morgan’s pocket) with the team captain collecting $150.

The incentives are an important aspect of the game: “People play differently when money is on the line,” says Morgan. But because he wants the incentives to mirror closely the business world, he won’t grade students on their performance in the game.

At first, the votes were straightforward. The first team to be eliminated, for example, didn’t show up to Tribal Council. Soon, however, the balloting became much less predictable. And that’s when WITS Going Down! ran into big trouble.

Emanuele Rusina, MBA 16 and a member of WITS Going Down!, says the teams in his house had all agreed to vote off members who had acted ruthlessly in trying to win weekly competitions. Yet, when votes were tallied, the “nice” teams in his house were being picked off. “It was clear early on that someone was playing a different kind of game,” says Rusina.

Learning from mistakes

To get back into the competition, WITS Going Down! embraced the kind of behind-the-scenes lobbying that it had originally avoided. The result: a second shot and an alliance that Rusina says — at least as of press time — will determine the team’s votes going forward.

Rusina, for one, is taking Morgan’s message to heart. “The game has been a great reality check for me, for my team, and for a lot of people who pride themselves on defining principles,” he says. “It’s teaching us how to learn from our mistakes, get back on track, and to keep friends close but your enemies just as close.”

Travis Dziubla, MBA 16, was surprised by his takeaway. He signed up for Game Theory in the hopes of learning more about mathematical approaches to complex business situations. He didn’t expect to get a heavy dose of life lessons, too. “We have this tendency as humans to attribute the worst possible intentions to any outcome,” says Dziubla, whose team, Russians v. Germans, was eliminated. But when dealing with human beings, “there can be lots of misinterpretation or different interpretations of the rules of a game.”

Hannah Davidoff, MBA 16, agrees: “If you think about it, ‘Survivor: Game Theory’ recreates the game of life.”

By Krysten Crawford

Prof. Severin Borenstein was 28 and pumping gas in Ann Arbor, Michigan, when his career path suddenly shifted gears.

It was 1986 and Borenstein, then an assistant professor of economics and public policy at the University of Michigan, had established himself as an expert on airline competition and pricing. But as he filled up his Toyota wagon that day, he asked the station owner why he sold unleaded gasoline for the same price as leaded, even though other stations charged more for unleaded. He didn’t get a clear answer, other than to learn that station owners bought both formulations for the same price. They just jacked the price of unleaded higher because they could.

For Borenstein, E.T. Grether Chair in Business Administration and Public Policy at Haas, that quick stop at the gas station marked a turning point. He has spent much of the nearly 30 years since researching and analyzing energy markets, beginning with oil and gasoline, and then expanding to electricity, natural gas, and now climate change.

Last month, the International Association for Energy Economics (IAEE), a membership organization for professionals working in energy economics, honored Borenstein with its annual Outstanding Contributions to the Profession Award.

For Borenstein, it was the third award this year. In April, he was named a distinguished fellow of the Industrial Organization Society.  And in January, the Power Association of Northern California presented the Energy Institute with its 2014 Achievement Award.

A Body of Work

Peter Hartley, an economics professor at Rice University and current president of the IAEE, credited Borenstein not just for his work in energy economics, but for his insights into how markets of all types behave when it comes to competition and price discrimination.

“If you look at his body of work as a whole, it’s interesting to see that Borenstein has always had a keen interest in real-world observations of markets and how they behave,” says Hartley. “He’s not doing theory for theory’s sake.”

Of Borenstein’s many notable accomplishments, several stand out. Among economists, he is perhaps most closely associated with the prestigious U.C. Energy Institute, where he became director in 1994, and its successor organization, the Energy Institute at Haas, where he served as faculty director from its creation in 2009 until stepping down as director last year. He is now a research associate of the Energy Institute.

Borenstein left Michigan in 1989, joining the economics department at U.C. Davis. He moved to Haas in 1996.

Since returning to California, where he grew up (he's a Berkeley High grad), he has been heavily involved in California’s energy policy. As chair of the California Energy Commission’s Petroleum Market Advisory Committee, he is working with fellow committee members to figure out why the price of gas in California this year has been substantially higher than the national average. He also advised the California Air Resources Board on the implementation of the state’s cap-and-trade program, which took effect in 2013 and is aimed at leveraging market forces to reduce greenhouse gas emissions.

An established expert

The two years he spent advising the Air Resources Board had its roots more than a decade earlier. In 1997, Borenstein was appointed to the governing board of California’s Power Exchange, which oversaw the state’s wholesale electricity market, on the eve of deregulation. To hear the IAEE’s Hartley tell it, being named to the California Power Exchange was akin to “being asked to advise the Federal Reserve on monetary policy.”

Borenstein had already established himself as an expert on oil and gas pricing. But he quickly became known for his insights into electricity markets when he co-authored a paper that presciently predicted the huge spikes in electricity prices that followed deregulation. The Air Resources Board wanted to know if the cap-and-trade program would have a similar impact on prices. It didn’t.

For the last decade, Borenstein has worked extensively on climate change and the economics of restricting greenhouse gas emissions. Today, much of his research is focused on distributional impacts—specifically, ways to minimize the harm that climate change policies could have on the poor.

Throughout his career, Borenstein has also published extensively on pricing and competition in other industries, including insurance, e-commerce, mining and natural gas. He’s continued, too, to study airline competition and profitability.  “The simple stories that markets are good or markets are bad aren’t right,” says Borenstein. “You have to delve into each particular situation.”

Read more on Severin Borenstein and the Energy Institute at Haas in BerkeleyHaas Magazine.

Berkeley-Haas raised just under $700,000 during the 2015 Big Give, a 24-hour campus-wide online fundraiser held Nov. 19.

With a total of 561 gifts, Berkeley-Haas donors topped last year’s total of $561,000. UC Berkeley raised a total of $5.5 million across the campus from 8,149 gifts.

“We are so thankful for the tremendous support and enthusiasm we received from all of our generous donors this year,” says Michelle McClellan, assistant dean of Berkeley-Haas Development & Alumni Relations. “The entire Berkeley-Haas community came together to support programs, students, and faculty, making this year’s event even better than the last.”

This year's fundraiser—themed "Think Bigger”—included competitions that fostered friendly rivalry between Berkeley schools and departments based on the most money raised, as well as the highest participation rates. Individual donors also competed with creative photos on social media, where people posted “Think Bigger” thought-bubbles filled in with their own ideas on how Berkeley reaches beyond itself.  

To help with the effort, Dean Rich Lyons broke out his guitar for a music video. (below)

Berkley-Haas placed second among all schools and departments, just behind the College of Engineering. The feat earned the school $22,600 in extra "Big Slice" funds, designated for schools with the most money raised.

If you missed the Big Give, it’s not too late to donate.

More than 95 percent of job seekers in the Full-time Berkeley MBA Class of 2015 received offers—and 94 percent accepted offers—within three months of graduation. The class, which showed a strong bent for social impact and entrepreneurship, also had a slight uptick in salaries.

Average starting salaries were $123,043, with signing bonuses averaging $28,000 and other compensation averaging $26,000. The median starting salary was $125,000, up 4 percent from $120,000 last year.

"It was a strong class with a lot of interest from recruiters," said Julia Min Hwang, assistant dean of the MBA Career Management Group and corporate engagement. "We've found that recruiters seek out Haas grads for culture fit—they are known for being leaders with innovative problem solving and team-building skills, and for having confidence without attitude."

Hwang also credited the strong hiring outcomes to the business school's Bay Area location, which gives easy access to a wide range of employers and allows companies to engage with Haas by bringing projects into classrooms.

Haas MBA culture is also collaborative, and students support each other in their searches, Hwang noted. One example is network job search teams: career services brings together those students who are interested in nontraditional industries that don't participate in on-campus recruiting. "The key to the success of this facilitated groups is that students motivate each other and hold each other accountable," she said.

Although many students are pursuing non-traditional careers, 40 percent of the 248 graduates accepted jobs in the MBA bedrock industries of consulting and financial services. Another 38 percent went into tech. The next most popular industries were healthcare, energy, consumer products and real estate. More than 12 percent of graduates reported that their jobs had a social impact component.

Meanwhile, the class produced an unprecedented number of new entrepreneurs. A record 31 graduates, or 12.5 percent of the class, are launching their own ventures, compared with six grads last year. Startups range from platforms for on-demand health services, global money transfer and student loans, to an innovative financial instrument aimed at combatting drought and wildfires.

The increase in student founders, along with the fact that 14.5 percent of jobseekers accepted offers from startups, reflects the growing strength of the entrepreneurial ecosystem at Haas, UC Berkeley, and the Bay Area.

"The most important reason why I chose Haas is its entrepreneurial environment and resources," said Leo Popov, MBA 15, who cited the MBA program's electives and applied innovation courses, the LAUNCH startup competition, and resources such as the Lester Center for Entrepreneurship and Skydeck. "I was 100 percent sure that I want to start my company in the short or medium future, but I needed the skills and knowledge to do so."

Popov met his business partner, Bimohit Bawa, MBA 16, in Lecturer Steve Blank's Lean LaunchPad course, and they worked on their startup idea throughout the rest of the program. In October, they launched TrueCare24, a digital health smartphone app that gives users access to urgent care clinicians who make house calls or consult by phone 24 hours a day. 

"In my previous job I didn't have any experience with about 60 percent of the tasks I am doing currently. All these skills are newly acquired at Haas or UC Berkeley," Popov said. "The most inspiring resources for me are the success stories of my peers and Haas alumni who dared to start their own ventures, and within several years built amazing companies."

By Krysten Crawford

Paul Crandell had them at “Go Bears!” The room erupted into cheers as the senior vice president for global marketing at GoPro began his nearly two-hour presentation this month on the rapid rise of the company behind the wildly popular mountable cameras.

Businesses succeed when there’s passion behind them, Crandell told the 60 or so Berkeley-Haas MBA students. GoPro, which started in 2004 and is based in San Mateo, taps into not just the passion of its founders and 1,000-plus employees, but also the enthusiasm and sense of adventure felt by its customers.

Millions of people have bought GoPros, he said, “because they wanted to share their story.” And in return for giving them the means to express themselves, GoPro gets a marketing team of millions. “We’ve got users building our brand every day,” continued Crandell. For Lynn Upshaw, Crandell’s message was exactly what he wanted his students to hear. Upshaw, an author and founder of Upshaw Marketing, has taught the core first-year MBA course Marketing Management at Haas for five years. Guest lecturers like Crandell, he says, have always been an important component of his teaching.

He’s not alone. Every semester, Haas faculty members bring in dozens of guest speakers as a way of complementing their course instruction with real-world examples.

This fall, for example, a wide range of outside experts, including Haas alumni, passed through the lecture halls, including:

• Peter Boland, senior vice president of brand and advertising at Charles Schwab & Co.
• Angela Loeffler, chief people officer at the Lending Club
• Curren Krishnan, chief of staff to Stacy Smith, Intel’s chief financial officer
• Scott Kucirek, MBA 99 and CEO of Five Star Organics
• Jennifer Sey, global chief marketing officer of the Levi’s Brand at Levi Strauss

Guest speakers aren’t limited to the Haas classroom. The Dean’s Speaker Series, for example, regularly hosts high-profile speakers, which recently featured guests ranging from former Vice President Al Gore to Alice Waters, the famous food activist and chef behind Berkeley’s Chez Panisse. The school’s various centers also spotlight outside speakers. For example, the Clausen Center earlier this year brought in John Williams, president of the Federal Reserve Bank of San Francisco.

In Upshaw’s marketing class, Paul Crandell of GoPro helped drive home one of the course’s key takeaways: that marketing in the digital age is built on word of mouth. GoPro is an outstanding example of a company that has convinced its customers to market to each other, Upshaw says. (Its users have uploaded more than 3.9 years’ worth of GoPro videos to YouTube.)

John Moore, MBA 17, and one of Upshaw’s students this semester, says that the 25-plus guest speakers he’s been exposed to in his first semester at Haas have helped give him a “360-degree perspective” on the business world. What’s more, students know to arrive early to class when there’s a guest speaker they want to network with (Some of Upshaw’s students have landed internships through these interactions).

For Moore, what stood out from the GoPro presentation wasn’t so much what Crandell had to say about the company, but how clear it was that Crandell and GoPro were right for each other. “It can seem a bit abstract at times to hear business school career advisers talk about the importance of finding the right cultural fit with a future employer," says Moore, an avid outdoorsman who exudes GoPro-like passion and enthusiasm.

Guest speakers get something out of their time at Haas, too, says Upshaw. “Because Haas is a prestigious business school, a lot of people want to come and speak,” he says. “They like to give back and they enjoy the conversation.”

By Krysten Crawford

For Ulrike Malmendier, the accolades are piling up. The Haas finance professor’s groundbreaking insights into how ego and other personality traits of business leaders influence corporate strategies have catapulted her to the forefront of modern economics.

Her work also caught the attention of the German government, which has awarded Malmendier a prestigious research grant through a foundation it set up to promote academic cooperation among top scholars and scientists from around the world. Malmendier, the Edward J. and Mollie Arnold Professor of Finance, is one of about 20 top researchers to be honored this year with the grant from the Alexander von Humboldt Foundation.

As part of the grant, which is officially known as the Friedrich Wilhelm Bessel Research Award and comes with a cash award of 45,000 euros, Malmendier is spending the current academic year with other grant recipients at the University of Bonn.

She is working closely with Hendrik Hakenes, the director of the University of Bonn’s Institute for Financial Economics and Statistics. Hakenes described Malmendier, whom he nominated for the award, as a “leading researcher” in the field of corporate finance and behavioral economics.

In nearly 14 years of teaching and research, Malmendier has emerged as a pioneer in the field of behavioral economics, which is the study of how emotional biases and character traits affect economic decision-making. While behavioral economics has mostly focused on how personality influences everyday investors and consumers, Malmendier has zeroed in on how these biases affect corporate decisions, stock prices, and markets in general.

Dean Rich Lyons offered high praise for Malmendier’s unique contributions to behavioral economics. “Ulrike has brought psychology to corporate finance and nobody had really done that before,” he says. He noted, too, that Malmendier joins a long list of Berkeley scholars who have influenced what is known about the role of personality in economics. They include Nobel laureates George Akerlof and Daniel Kahneman, and Haas Prof. Terry Odean.

Studies of CEOs, entrepreneurship

In her work on human behavior in corporate finance, Malmendier has made a number of key discoveries. For example, she has studied the role hubris in the C-suite plays when it comes to corporate strategy. Working with other researchers, Malmendier discovered that CEOs who build up big personal stakes in their companies (by not diversifying) are more likely to involve their companies in an unsuccessful merger or acquisition – an expression of their overly optimistic beliefs in the returns they will generate in their companies. She’s also shown that the job performance of celebrated CEOs tends to deteriorate when they’re in the spotlight — even as their compensation spikes.

Malmendier has also studied the characteristics of entrepreneurs. A study she co-authored with Josh Lerner of Harvard Business School found that having close acquaintances with entrepreneurs does not spur people to become entrepreneurs themselves. Why? Because experienced entrepreneurs are better able to steer would-be startup founders away from bad ideas.

Her contributions to behavioral economics have extended to consumers as well. Malmendier often collaborates with her husband, Stefano DellaVigna, a professor in Berkeley’s Department of Economics and, jointly, at the Haas School of Business. Together they have analyzed how fitness centers lure people into overpaying for gym memberships. They’ve also studied the motives behind generosity and found, among other things, that people in door-to-door fundraisers are influenced more by social pressure than they are by the desire to give.

These and other innovative insights have garnered Malmendier worldwide acclaim. In 2013, the American Finance Association honored her with its Fischer Black Prize. The biennial award honors the top finance scholar under the age of 40.

In addition to her growing body of research, Malmendier is a frequent speaker; she’s participated at the World Economic Forum in Davos and, just this year, has given a dozen keynote addresses, including one at the Economic Science Association’s meeting in Europe earlier this year. She’s also received numerous grants.

Infectious enthusiasm

In the fall, Malmendier will return to Haas. She’ll also resume her position as a professor in Berkeley’s Department of Economics and will teach her corporate finance classes in the EWMBA and PhD programs, for which she was honored with the campus-wide Distinguished Teaching Award last year.

For Malmendier, the Bessel award marks a coming home of sorts. She was born in Cologne and earned a double degree in law and economics from the University of Bonn. Faced with a choice between the two disciplines, Malmendier chose economics. After her PhD in law from Bonn in 2000, she graduated a PhD from Harvard University in 2002.  After stints at Stanford, Princeton,  and the University of Chicago, she started teaching in Berkeley’s Department of Economics in 2006. She accepted a joint appointment with Haas in 2010.

Dean Lyons said Malmendier stands out for reasons other than her research. Specifically, he cited her passion for ideas and the way her enthusiasm infects everyone around her. “She has a very high cognitive clock speed, and you feel empowered when you’re around her,” he says. “I think of this metaphor of ‘drinking from the fire hose.’ She’s one of those people whose ideas make you think, ‘Wow, this is really fun!'”

In a move that brings an enhanced focus on development in a critical world region, the Center for Entrepreneurship & Development in the Middle East is now part of Berkeley-Haas

The new center, formerly affiliated with the UC Berkeley Institute of Governmental Studies, was created to conduct research, draft educational materials, host conferences, and offer policy recommendations for entrepreneurship in the Middle East and North Africa region.

Founder and Director Dariush Zahedi approached Dean Rich Lyons in May, believing that Haas might be a better strategic fit because of its commitment to entrepreneurship and innovation. Lyons agreed and invited the center to join the Institute for Business Innovation at Berkeley-Haas.

“We felt that the proper location for the center is within the business school because we’re promoting entrepreneurship,” Zahedi explained. “The dean has been so helpful and supportive.”

Zahedi, a native of Iran, is no stranger to UC Berkeley. He has taught Middle East-related courses for the departments of Political Science, Political Economy, and Peace and Conflict Studies - and at the Boalt Hall School of Law.

Last June, Zahedi (pictured) organized the successful iBridge conference for the Entrepreneurship Center in Berlin, as well as conferences in Morocco and Turkey in 2014. He plans to follow up with another conference in the Bay Area this spring.

The goal is to bring more entrepreneurship opportunities, role models, and training to a region that has many challenges, including a high unemployment rate among a young population, anemic economic growth, and little access to venture capital.

“We believe this effort can help to change the youth’s attitude from frustration to possibility, and help to boost entrepreneurial activity, job creation, and sustainable growth," Zahedi says.

While political and economic issues are a challenge and many countries in the region are oil-dependent, there has been some success in raising literacy rates and education for women, Zahedi says.

 “Women are an important solution to many of the problems inflicting the region,” he says.

Zahedi also notes the number of successful Bay Area entrepreneurs with links to the Middle East, including eBay founder Pierre Omidyar and Twitter’s Executive Chairman Omid Kordestani. Both are of Iranian descent.

Maria Carkovic, director of the Institute for Business Innovation, said Haas is a good fit for the new center.

“We’re excited to expose these potential entrepreneurs to the opportunities that exist here at Haas.”

By Charles Cooper

Driving back from San Diego to the Bay Area last year, Saharnaz Safari, MBA 16, pondered the ravages of the California drought on the parched farmland she passed.

Safari and Sohrab Haghighat, an aerospace engineer who accompanied her on the trip, started discussing what sort of affordable, practical solutions could be created using drones to help farmers. The talk quickly led the pair to develop an idea for Clima, a startup that aims to use fleets of drones to create rain and snow in drought-ridden areas.

A $5,000 grant Clima received from the newly-launched Dean’s Startup Seed Fund last year is just enough to get the concept off the ground. The $100,000 fund, announced last October, provides grants to early-stage startups that include Berkeley-Haas students.

The first ten grants were awarded last month, and ten more will be announced in April, said Rhonda Shrader, who oversees the new Berkeley-Haas Entrepreneurship Program (BHEP).

The company ideas in the first group of winners range from a wearable hand sanitizer to an app for people with diabetes to a platform connecting consumers with farmers and food producers.

“We’re off to a great start with these ideas that attack pain points in industries ranging from agriculture to healthcare,” Shrader said. “Our student teams are so excited to begin testing their concepts and this fund is generating a fresh level of enthusiasm among our student entrepreneurs.”

The drones that Clima needs are large and expensive—about $20,000 apiece. The company is using its grant to secure a smaller drone so it could get to work developing an algorithm to prove the product concept to investors.

“The fund has been very important in helping us build a minimum viable product,” said Safari, who plans to continue working on the startup after graduation. “It also paves the path to receive additional funding.”

Shahidah Abdul Rashid & Team D! are developing a diabetes app

Another grant recipient, Shahidah Abdul Rashid, MBA 17, co-founded Team D! with a team that includes Howard O, MBA 17. Team D! is developing a mobile app to help Type 2 diabetes patients make healthy choices when dining out. The app proactively provides diabetic-friendly meal options at a restaurant — based on a diabetes index they are developing.

Abdul Rashid has a special motivation for the project: her father has struggled with modifying his lifestyle to manage diabetes, and has suffered serious health complications.

“We are incredibly excited to be grantees of the Dean's Seed Fund,” she said, adding that she and her partners intend to use the money to begin prototyping and testing.

“Our idea, from conception to where we are now with seed funding, would not exist if Haas did not have such an innovative mindset in the classroom and beyond," she said. "I have nothing but confidence as we move from innovation to entrepreneurship that we will be supported by the Berkeley network.”

By Sam Zuckerman

    For women, the business playing field is still not level despite their mass entry into the workforce decades ago. That’s the case not only in terms of employment, but also when it comes to securing financing for business ventures. Academic research shows females to be at a marked disadvantage in getting bank loans, venture capital funding, and other sources of money needed to grow a business. But, in one venue, women seem to have a notable edge—the fast-growing world of crowdfunding.

    Crowdfunding is the practice of raising money through contributions from large numbers of people, usually over the Internet. According to Andreea Gorbatai, an assistant professor in the UC Berkeley’s Haas School of Business , “women are better at telling a story that resonates with potential crowdfunding investors.” In an unpublished paper, entitled “The Narrative Advantage: Gender and the Language of Crowdfunding,” authored with Laura Nelson of Northwestern University’s Kellogg School of Management, Gorbatai notes that crowdfunding pitches rely heavily on the written word. Gorbatai and Nelson cite studies showing that men and women have distinct writing styles. Women generally express more emotion and write more about relationships, a style that is more successful than typical male writing at persuading online readers to hand over money.

The crowdfunding market is not trivial. Globally, 1.1 million campaigns raised $2.7 billion in 2012, according to a study cited by Gorbatai and Nelson, and the numbers have soared since then. Crowdfunding contributions are more like donations than investments. Donors want to support a worthy cause and aren’t looking for a financial return except in the more recently emerged equity crowdfunding market. For that reason, effective appeals usually take the form of compelling narratives that create excitement and stir emotion. “Rather than the dry language of finance, crowdfunding pitches require colorful, vivid language,” Gorbatai and Nelson emphasize.

The authors tested their ideas by examining nearly 9,000 small business and technology fundraising campaigns on the Internet crowdfunding site Indiegogo between February 2010 and December 2013. They looked at campaigns created by solo entrepreneurs and identified the probable gender of both fund seekers and donors based on first names. Gorbatai and Nelson then did a statistical analysis of funding appeals along four language dimensions, including upbeat emotion, descriptive vividness, a sense of inclusion in the project, and use of business language focused on money and finance.

Pitches created by women were more likely to express positive emotion, vividness, and inclusiveness, and less likely to use business language. And that partially accounts for why women did better. Crowdfunding campaigns that used emotional and inclusive language tended to succeed, while those that relied on dry, business language more often came up short. Vivid language had little impact on fundraising success.

These results confirm Gorbatai and Nelson’s hypothesis that differences in male and female language patterns partially explain women’s crowdfunding advantage. Interestingly, these effects didn’t depend on donor gender. Men and women responded about the same to the language style in pitches.

Prior research has found that language makes a difference in face-to-face business settings, such as movie pitches and venture capital presentations. But, in such interactions, decisions are made by a small number of people, predominantly male. Nonverbal factors, including body language and personality, may subject women to stereotyping or discrimination. By contrast, online pitches are a purer environment with no personal interaction. Written language becomes more critical for fundraising success.

The crowdfunding study is a natural extension of Gorbatai’s earlier work. She earned a Ph.D. in Organizational Behavior from Harvard and joined the Haas faculty in 2012. Her research has focused on social networks, especially online communities. Her doctoral dissertation looked at Wikipedia as a virtual form of organizing involving millions of people around the world. “I didn’t set out to be a gender studies scholar,” she says of her crowdfunding work. “But the results were very strong. It was the natural way to go.”

Even when a startup fails, the risk pays off.

Tempted to launch a new business?

Entrepreneurs statistically fail more often than not, but new research suggests that the financial risk is not as great as previously thought, as failed entrepreneurs can return to the salaried workforce and recover their earnings quickly.

While prior research maintained that entrepreneurs bear more risk than salaried workers, Assoc. Prof. Gustavo Manso of the Haas Finance Group at UC Berkeley’s Haas School of Business found that entrepreneurs receive comparable lifetime earnings when they return to a salaried position and, therefore, are exposed to less risk than previously thought.

And those who remain entrepreneurs earn substantially more than their less adventurous counterparts over time.

“Would-be entrepreneurs may think they have a huge chance of failure and will be sacrificing earnings for the rest of their lives, but it’s not true,” says Manso. “Even if the business fails, entrepreneurs don’t suffer as much since they are able to quickly transition to the salaried workforce.”

The findings can be found in Manso’s working paper, Experimentation and the Returns to Entrepreneurship.

Manso followed the careers of entrepreneurs over three decades, including both founders of innovative startups as well as small business owners such as restaurant owners—successful and unsuccessful.

He used the National Longitudinal Survey of Youth-1979 (NLSY79) to model entrepreneurship’s return on investment, or ROI. He gained access to data on 12,686 young men and women who ranged in age from 14 to 22 years old when they were first surveyed in 1979.

The participants were interviewed annually through 1994—and continue to be interviewed every other year. The Longitudinal Survey also provided Manso with the participants’ demographics, education, careers, and labor market traits.

The survey revealed that 52% of entrepreneurial endeavors last less than two years.  Understandably, entrepreneurs who earned less while self-employed tended to abandon the solo route more often than those who earned more as entrepreneurs.

Over a lifetime, the entrepreneurs not only earn about 10% more but also do so with less risk than previously thought, according to Manso’s research. “The study suggests that becoming an entrepreneur is a rational decision and failing isn’t as bad as one would think,” says Manso. “It doesn’t hurt your lifetime prospects.”

By Sam Zuckerman

Berkeley-Haas finance Prof. Richard Stanton was handed a unique assignment last year that, when completed, had the potential to shake stock, bond, and property markets from New York to Hong Kong.

The question: How should one of the world’s biggest pools of money be invested?

Stanton served as one of three outside experts preparing recommendations on where to put the money in the Norwegian fund created to invest the country’s oil riches—the largest state-owned investment fund in existence.

The North Sea off Norway lies atop one of the world’s most bountiful oil fields, which has given the country’s 5 million people almost twice the per-person income of Saudi Arabians. In 1990, the Norwegian government created a fund to invest revenue from oil taxes and drilling licenses to pay future pension costs after the oil runs out.

More than 25 years later, the Government Pension Fund Global, as the fund is formally known, has grown to an almost unimaginable scale, swelling by late 2014 to $857 billion and holding about 1 percent of the world’s stock market wealth. It’s so enormous that it must tread carefully so that its trading doesn’t swamp investment markets.

Berkeley-Haas finance Professor Richard Stanton (right) with NYU finance Professor Stijn Van Nieuwerburgh. Photo by Per Ståle Bugjerde

Norway’s Finance Ministry periodically invites groups of academics and financial professionals to review the fund’s investment policies. Last year, the ministry named New York University finance professor Stijn Van Nieuwerburgh to head a committee charged with examining potential fund investments in real estate and infrastructure.

Van Nieuwerburgh asked Stanton, a finance and real estate scholar with special expertise in mortgage markets, to serve with him. “I chose Richard because he is a world-class researcher in the area of residential and commercial real estate, as well as financial economics more broadly,” Van Nieuwerburgh explains. “I also chose Richard because he is such a nice colleague to work with, with a nice dose of British humor.”

For Stanton, who holds the Kingsford Capital Management Chair in Business in the Haas Finance Group, the oil fund assignment represented a special opportunity to put into practice the finance theory he teaches and uses as a scholar.

Stanton and his colleagues were asked to consider whether the fund’s manager, the Norwegian central bank, should increase the share of investments put into real estate above the current 5 percent limit. They also looked at whether the fund should begin investing in private infrastructure projects—roads, airports, power grids, hospitals, and the like. They began work in April 2015 and traveled to Oslo in December to give their report.

The advisors recommended that the fund be allowed to raise the real estate limit to 10 percent and allow infrastructure investments up to another 10 percent of its portfolio, a major shift given that stocks and fixed-income investments such as bonds currently make up about 97 percent of its holdings. But they were careful not to suggest that the fund rapidly build up its investments in these nontraditional areas, and they warned that global real estate prices are high now by historical standards.

“Our recommendation was to increase flexibility, not that they increase holdings of anything,” Stanton says.

The logic behind these recommendations represents a classic application of finance theory to the real world. For example, most commercial real estate and some infrastructure investments are private, which makes them hard to sell. To attract investors, they must offer a higher return than more-liquid publicly traded investments. That gives a long-term investor like Norway’s oil fund an opportunity.

“They have no need to take money out in, say, five years,” Stanton says. “They’re exactly the kind of fund that should have these kinds of investments.”

By Krysten Crawford

Companies are taking more responsibility for combatting human rights violations worldwide and Berkeley-Haas is taking bold steps to help businesses achieve their goals.

Late last year the Berkeley-Haas Center for Responsible Business launched the Human Rights & Business Initiative. The initiative combines existing and new courses with cutting-edge research and outreach programs to help companies devise their own human rights strategies.

The new initiative reflects a worldwide shift in responsibility for human rights, traditionally viewed as solely a government’s responsibility, said Robert Strand, the executive director of the Center for Responsible Business.

Today, there’s a broad consensus among leading companies that they have a responsibility and opportunity to respect human rights — from ensuring safe and fair working conditions in factories worldwide to grappling with government surveillance of Internet communications to balancing workers’ rights in the new “gig economy,” Strand says.

“Human rights have really risen to the top of the corporate responsibility agenda in recent years,” adds Faris Natour, a business and human rights expert who joined Berkeley-Haas last year and is directing the Human Rights & Business Initiative. The challenge, he adds, is that many companies don’t yet have the tools they need to build awareness of human rights issues into their DNA. That’s an opportunity for Berkeley-Haas, he says.

Robert Strand, (left) executive director of the Center for Responsible Business & Faris Natour, director of the Human Rights & Business Initiative

The initiative will play a key role within the Center for Responsible Business. This includes engaging with the student-run Haas Socially Responsible Investment Fund (HSRIF), which holds more than $2 million in investments.

The initiative has three key components:

Teaching: Berkeley-Haas already offers a course on business and human rights. The goal now is to integrate a human rights component into more mainstream business courses, such as supply chain management and finance. Conversely, the hope is that human rights courses taught throughout UC-Berkeley will also incorporate business management lessons.

Research: The initiative plans to tap the resources of the Sustainable Products & Solutions program at the Center for Responsible Business to develop proven strategies that companies can use to integrate human rights issues into their decision-making. For example, the initiative will study the link between human rights and financial performance, the role of investors in funding sustainable businesses, and how companies in the “gig economy” can thrive while also guaranteeing workers wrights, Natour says.

Collaboration: Bringing companies, governments, investors, and other stakeholders together to devise strategies for handling human rights issues is difficult, but necessary, Strand says. Haas is well-positioned to foster collaboration through conferences, workshops and other avenues, he says.

The decision to create the initiative furthers a long tradition at UC Berkeley of advancing human rights. It’s also a reflection of the Berkeley-Haas Defining Principles. “We are constantly encouraging — even demanding — our students to go ‘Beyond Yourself’ and to ‘Question the Status Quo.’ That’s ultimately what we’re doing,” Natour says.

Real estate and finance professor Dwight M. Jaffee passed away peacefully on Thursday, January 28, 2016, in San Francisco, CA, at the age of 72.

He lived in Berkeley, CA.

Jaffee was the Willis Booth Professor of Banking, Finance, and Real Estate, and a member of the Finance Group at the Haas School of Business. He also served as co-chairman of the school’s Fisher Center for Real Estate and Urban Economics.

Since arriving at Berkeley-Haas in 1991, he established himself as a respected scholar in mortgage markets, banking, risk and catastrophe insurance, and international trade. Most recently, he testified in front of Congress and the SEC in hearings on Freddie Mac, Fannie Mae, and the recent banking and housing crisis.

“A major theme of Dwight’s research was the negative impact of federal government policies on the mortgage markets,” said Ken Rosen, chair of the Fisher Center, who with Jaffee authored an early paper published by the Brookings Institution that showed the adverse effect of interest rate ceilings on deposit flows to savings and loans. “More recently, Dwight advocated for the privatization of the residential mortgage market by suggesting mechanisms for winding down the role of Fannie Mae and Freddie Mac.” 

Jaffee also expressed those views in a 2010 opinion piece published in the Wall Street Journal.

“Dwight Jaffee was a world-class scholar who made profound contributions to our understanding of contracting under asymmetric information and issues related to the operation of the mortgage and insurance markets that are among the largest capital markets in the world,” said Professor Nancy Wallace, the Lisle and Roslyn Payne Chair in Real Estate Capital Markets and co-chair with Jaffee of the Fisher Center.

“Dwight had a razor-sharp intellect, which he applied with skill and grace in his efforts to affect the public policy debate on questions related to the causes of the financial crisis—which he had anticipated years before its onset,” added Wallace.

Jaffee was an advisor to many central banks throughout Europe. He was the author of more than seven books, including The Impact of Globalization in a High-Tech Economy, co-authored with Ashok Bardhan and Cynthia Kroll and published in 2003, and The Oxford Handbook of Offshoring and Global Employment, which he edited with Cynthia Kroll and Ashok Bardhan and which was published in 2013. He also authored 171 papers in the fields of money and banking, finance, and risk and catastrophe insurance.

“Dwight was instrumental to our school's preeminence in real estate finance and blazed new trails in related areas as well—such as how markets can and should insure against the risk of catastrophes like earthquakes,” said Haas School Dean Rich Lyons. “On top of all this, he was cherished as a colleague and an all-around good guy.”

In the last few years, Jaffee also examined the role played by capital markets in explaining the collapse of private markets in catastrophe insurance. Following a catastrophic event, whether natural, such as an earthquake, or man-made, such as a terrorist attack, the insurance market needs access to large quantities of capital to pay out on potentially large losses.

Unwilling or unable to meet this requirement, many private insurers abandoned the catastrophe insurance line. Jaffee, in a number of papers, raised the question whether state and federal government play an appropriate role in supporting this market.

“Among his many academic talents, Dwight was a skilled and insightful applied econometrician. His individual warmth and vibrant personality combined to make him a terrific teacher and an even better friend,” said Dan Rubinfeld, the Robert L. Bridges Professor of Law and Professor of Economics at New York University’s School of Law and a faculty associate at the Fisher Center.

Throughout his career, Jaffee received many awards, including the 2007 Robert I. Mehr Award from the Journal of Risk and Insurance. He was an associate editor at Housing Finance Review, the Journal of Economic Perspectives, Journal of Finance, Journal of Monetary Economics, and the Journal of Money, Credit, and Banking.

In the early 1990s, he led a joint project between the Haas School of Business and the Graduate School of Management in St. Petersburg University, Russia, to establish the city's first post-Soviet era school of business. Prior to joining Berkeley-Haas, Jaffee was a professor of economics at Princeton University from 1968 to 1990.

“One of his greatest passions was his mentorship of countless undergraduate and graduate students at both Berkeley and Princeton,” said his wife, Lynne LaMarca Heinrich, a lecturer and advisory board member of the Center for Social Sector Leadership at Berkeley-Haas. “It’s what led him to establish an endowed fund at MIT. Another was his vibrant and intellectual relationships with so many of his Berkeley colleagues. He claimed, to the end, that he had no remaining bucket list…that he’d accomplished what he had set out to do, and his life was full and meaningful.”

Jaffee's passion for teaching was central to his life's work. “I view teaching as a way to transmit research results to young people and maybe even create within them a great desire to understand and carry out their own research,” Jaffee once said in an interview with a Berkeley-Haas news writer. “I think there’s just no doubt the biggest legacy of the school is the students.” Jaffee was named one of the “World’s Best B-School Professors” by the website Poets & Quants in 2012.

"Dwight was instinctively accessible to colleagues and students for interaction and counsel. His advice was thoughtful and incisive,” says Professor Robert Edelstein, the Maurice Mann Chair in Real Estate and also co-chair with Jaffee of the Fisher Center. “On a personal level, he was gracious and jovial, with a wide smile and a kind word."

Jaffee was born in Chicago, IL, on February 7, 1943, to Gertrude and Woodrow Jaffee. He received his BA (Phi Beta Kappa) from Northwestern University in 1964 and his Ph.D. in Economics from MIT in 1968. Besides his wife, Lynne, Jaffee is survived by his mother, Gertrude, of Boca Raton; his daughter, Elizabeth, known as Betsy, a Foreign Service Officer with the U.S. Department of State; his son, Jonathan, Assistant Professor of Strategy, Law, & Organizations at the Drucker School of Management, Claremont Graduate University and Haas Ph.D. alumnus; and two grandchildren.

In addition to his academic pursuits, Dwight was known for his connoisseurship of fine wine, love of travel, hiking in the hills of Marin County, and loving friendships.
In lieu of flowers, the family has asked that gifts be directed to the Dwight M. Jaffee (1968) Endowed Fund for Graduate Students at MIT, c/o Bonny Kellermann 72, MIT Director of Memorial Gifts, 600 Memorial Drive, Room W98-526, Cambridge, MA 02139, or https://giving.mit.edu/givenow/ConfirmGift.dyn?desig=3302325.

Jaffee's memorial will be held on Sunday, March 13, 2016, at 3 p.m. at the University Club at California Memorial Stadium.

Please RSVP to Linda Algazzali at algazzal@berkeley.edu by March 4, 2016.