Andrea Vedolin, Assistant Professor of Finance at ÐÓ°ÉÂÛ̳, has been awarded a major research grant designed to enable outstanding early-career social scientists to become the future world leaders in their field. The £312’000 of funding from the ESRC will support work entitled ‘Aggregate Duration Risk’.
The Future Research Leaders Scheme forms a key part of the ESRC’s strategy to invest in the most talented individuals at all stages of their careers. It is open to candidates from across the world with a maximum of four years’ postdoctoral experience and the support of an eligible UK research organisation.
By supporting Dr Vedolin the ESRC believes it is backing not only an outstanding social science research project, but also an individual with the potential to become a ‘future world leader’ in her field.
Aggregate Duration Risk project overview: For the past five years, central banks around the world have pushed down interest rates on traditionally safe assets such as bonds close to the zero boundary in the hope of sparking economic growth. Now that most economies seem to have recovered, central banks have announced a tapering of their monetary policy. While there is a widespread agreement that higher interest rates can have negative consequences for a fragile economy, we have surprisingly little knowledge about (i) how to measure aggregate interest rate risk and (ii) to what extent and through which channels it affects the economy. The goal of this project is to provide a better understanding of aggregate interest rate risk both empirically and theoretically.