Vici grant for Albert Menkveld
Albert Menkveld, URC Professor of Finance, has won a prestigious Vici grant from the NWO (Netherlands Organization for Scientific Research). With this € 1,5 million grant, Albert will execute his research proposal titled “Financial Techology’s (FinTech’s) Disruptive Impact on Financial Markets: Social Costs and Benefits of an Emerging New Architecture” in the next five years.
02/23/2018 | 12:00 PM
‘I am deeply honored by having been awarded this Vici grant. It is a recognition by peers of not only the ambitious research agenda I proposed, but also of what I have achieved thus far with the support of my earlier Veni and Vidi grant. I am very, very grateful for all this!‘
- Albert Menkveld
Vici is a funding instrument from the Talent Scheme of NWO. It gives senior researchers the opportunity to build their own research group.
Summary of the research
The optimal design of financial markets has long been an important field in economics. What type of market maximizes welfare and is thus most desirable? And, does it arise naturally or might we be stuck in a sub-optimal equilibrium? In finance, the field is referred to as microstructure.
Microstructure research moved center stage in recent decades as exchange floors were replaced by computers matching buy and sell orders. Traders, in turn, coded their trading strategies into computer algorithms and let “robots” execute them on their behalf. This development received lots of public attention, in particular after Michael Lewis published the instant best seller Flash Boys in 2014. Regulators worldwide struggled to take a position as to whether the new microstructure was good for investors and the economy at large. Microstructure papers benefitted from the attention and appeared in the very top journals in finance and economics (see Menkveld, 2016, for a survey).
The arrival of electronic markets is only the beginning of how financial technology (FinTech) will reshape the financial industry, says Mark Carney, current chairman of the FSB, a consortium of central bankers world-wide. The academic community agrees. Leading scholars conclude that FinTech will alter financial institutions and markets in ways that existing knowledge about them is of little use. Moreover, the ensuing digital economy will produce big data in need of being processed meaningfully to both understand and control the new financial system.
About Albert Menkveld
Albert Menkveld is Professor of Finance at VU Amsterdam and Fellow at the Tinbergen Institute. In 2002, he received a Tinbergen PhD from Erasmus University Rotterdam. He was on visiting positions for multiple years at various US schools (NYU, Wharton, and Stanford). Albert's research agenda is focused on securities trading, liquidity, asset pricing, and financial econometrics. He has published in various journals, for example, the Journal of Finance, the Journal of Financial Economics, and the Review of Financial Studies. Albert is Associate Editor at the Review of Asset Pricing Studies and a Research Fellow at the Centre for Economic Policy Research (CEPR).