Three YC Students work with Nobel Laureate Robert Shiller on Narrative Finance

July 28, 2017

Yale’s Herb Scarf Summer Research Program brought three Yale computer science majors to SOM for a summer of work on “Narrative Structures in Financial Media.”  Nidal Hishmeh, Jacob Hoops and Shah Khan worked with three professors: Nobel Laureate Robert Shiller, IFC Director William Goetzmann and OFR’s Dasol Kim (ICF Affiliate) on “big data” methods for identifying the viral stories that drive the stock market.  Together they created programs to screen hundreds of thousands of news items for key explanatory themes.   

Robert Shiller (3nd from right) is one of the founders of  the field of Behavioral Finance.  His presidential address to the American Economic Association entitled “Narrative Economics” proposed a new approach to the study of economic behavior based on finding the stories that people use to understand and predict economic phenomena.  The summer research program was a concrete step in developing these new methods.

The increasing sophistication of tools to analyze text has opened up new avenues for behavioral research.  According to Will Goetzmann, “Nidal, Jacob and Shah had some creative ideas about how to track evolving narratives through time.”  

Yale SOM is a leader in research and education around behavioral finance and decision-theory.  It sponsors conferences, summer doctoral programs, publications, lectures and pure research.  Much of this has been made possible by a generous grant from Whitebox Advisors.

For more information on behavioral finance research and events at the Yale School of Management, click here.

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About the author

William N. Goetzmann

Edwin J. Beinecke Professor of Finance and Management Studies & Director of the International Center for Finance