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Marco Di Maggio Is the New Tommaso Padoa Schioppa Visiting Professor

, by Fabio Todesco
A Professor of Finance at Harvard Business School, he will cover the position financed by the European Central Bank for the current semester

Marco Di Maggio (Harvard Business School - HBS) is the Tommaso Padoa-Schioppa Visiting Professor at Bocconi for the academic year 2020-2021.

The Professorship is funded by the European Central Bank (ECB) in memory of one of Bocconi's most illustrious alumni, among the founding fathers of the Euro and member of the Executive Board of the ECB from 1998 to 2005.

Di Maggio is the Ogunlesi Family Professor of Finance at HBS and a Faculty Research Fellow at the National Bureau of Economic Research. Before joining HBS, he was a faculty member in the finance and economics division of Columbia Business School.

His research agenda explores empirically the impact of the monetary and fiscal policy responses to crisis on both households and financial institutions. He has recently investigated whether financial technology, or "fintech", promotes greater inclusion in financial markets and how the use of alternative data by fintech lenders affect their lending decisions. Finally, his work has also investigated whether the rise of student debt in the US has significantly curtailed the financial and labor market prospects of the younger generations. Since many of the borrowers might never earn enough to repay these loans, policymakers are considering the possibility to intervene in this market by forgiving student debt. Di Maggio's findings underscore that, in absence of such policies, an important fraction of the young borrowers might be excluded from a life of financial security and high labor productivity.

"In my semester at Bocconi, I will work on two projects regarding the effects of monetary policy on the real economy," Professor Di Maggio says. "First, I plan to investigate the role of firms' networks on the transmission of economic policy stimuli. Large firms are thought to be more likely to have access to government funding but they also often provide trade credit to troubled counterparts. If this is the case, funding these large firms could have a more expansionary effect than expected."

"Second, I want to investigate whether a prolonged period of low interest rates might exacerbate inequality. The suspicion is that richer households with exposure to the stock market are likely to benefit from a boost to asset prices due to the decline in discount rates. In contrast, less-wealthy households are not going to fully reap the benefits of expansionary monetary policies, with relevant implications for our response to the current COVID crisis".

Professor Di Maggio, who in 2016 was named by Poets&Quants to the list of the Best 40 Under 40 Business school Professors, will also host a reading group on economic policy at the Bocconi PhD School.

The ECB funds the professorship with the aim of bringing an outstanding international scholar to Bocconi each year to pursue research and teaching linked to the theme of economics and European monetary policy. The ECB contributes to this aim with an annual donation of 30,000 euro. The list of past Tommaso Padoa-Schioppa Visiting Professors includes the late Alberto Alesina, Carlo Cottarelli, Kenneth Allen Shepsle, Fabrizio Zilibotti, Andrea Carriero, and Eric Ghysels.