Lasse Heje Pedersen from FRIC is awarded the Ross Prize
Professor Lasse Heje Pedersen from the Center of Excellence FRIC at the Copenhagen Business School has been awarded the prestigious Ross Prize for the most influential finance paper in the last 15 years. The paper “Over-the-Counter Markets” was originally published in Econometrica in 2005 by Professor Heje Pedersen. The paper has improved the understanding of these over-the-counter markets especially during the COVID-19 epidemic.
The paper “Over-the-Counter Markets” was originally published in Econometrica in 2005, but over the last 15 years, it has proven its influence in the finance world and shown its importance during the Covid-19 pandemic. Professor Heje Pedersen from the DNRF’s Center for Financial Frictions (FRIC) at the Copenhagen Business School has been awarded the prestigious Ross Prize for this paper and the research that has been built on it. Co-authors Professor Darrell Duffie from Stanford University and Professor Nicolae Gârleanu from the University of California, Berkeley, will share the award with Professor Heje Pedersen.
“Given the central role of over-the-counter markets, the liquidity of such markets has been of much concern to policymakers and the focus of many policy interventions, especially in times of crisis, such as during the global financial crisis and the disruptions in financial markets at the onset of the COVID-19 pandemic. The award-winning paper paved the way to improved understanding of the functioning of these markets,” said the Ross Prize committee in a press release.
New understanding of liquidity and price determination
The Stephen A. Ross Prize was established in 2008 to honor the late Steve Ross for his work in financial economics. This will be the seventh Ross Prize to be awarded and comes with a prize of $50,000.
“The paper and subsequent literature have transformed our understanding of liquidity and price determination in over-the-counter markets in which many financial assets are traded,” said the Ross Prize committee in a press release.