Rajnish Mehra

Rajnish Mehra
Born (1950-01-15) January 15, 1950 (age 74)
NationalityIndian American
Academic career
FieldFinancial economics
Quantitative finance
InstitutionArizona State University, National Bureau of Economic Research
Alma materIIT Kanpur
Rice University
Carnegie Mellon University
InfluencesEdward C. Prescott
Information at IDEAS / RePEc

Rajnish Mehra (Hindi: रजनीश मेहरा; born January 15, 1950) is an Indian American financial economist. He currently holds the E.N. Basha Arizona Heritage Endowed Chair at the Arizona State University[1][2] and is a Professor of Economics Emeritus at the University of California, Santa Barbara.[3]

Education

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Mehra received his doctorate in industrial administration from Carnegie Mellon University (1978), an M.S. in computer science from Rice University (1974), and a BTech in electrical engineering from the Indian Institute of Technology, Kanpur (1972). He spent a year studying mathematics at St. Stephen's College, Delhi University (1966–67).

Career

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In 1976, he was appointed assistant professor at the School of Business, Queen's University in Kingston, Canada. He subsequently moved to the Columbia Business School in 1977, and in 1985 to the University of California, Santa Barbara, where he taught until 2010. He was department chair from 2001 to 2004. From 2012 to 2016 he held the Deutsche Bank Chair at the University of Luxembourg.

His visiting appointments include MIT Sloan School of Management (1987–89 and 2004–5), the University of Chicago Booth School of Business (1995–2006) and non-resident senior fellow at the National Council of Applied Economic Research, New Delhi (2016–present).[4]

He has been a consultant to the Fixed Income Group at Salomon Smith Barney and an advisor to Vega Asset Management.

Main research contributions

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Recursive equilibrium theory

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He is probably best known for his contributions to recursive competitive theory, an equilibrium concept widely used in modern dynamic macroeconomics,[5][6] which he developed jointly with Edward C. Prescott.[7][8]

Determinants of the equity premium

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Another strand of his research focuses on understanding the determinants of the 'equity premium', the return earned by a diversified portfolio of stocks (such as the S&P 500) in excess of that earned by a risk-free security such as a Treasury Bill. In 1979 he and Edward C. Prescott observed that the real equity premium over the past 90 years in the US was 6.18%, an order of magnitude larger than that could be rationalized by neo-classical economic theory. They termed this the 'equity premium puzzle'.[9] Attempts to resolve the puzzle have become a major research impetus in both finance and macroeconomics over the past thirty years.[10]

References

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  1. ^ "Endowed Chairs and Professorships" (PDF). W. P. Carey School of Business. Archived from the original (PDF) on 2020-03-03. Retrieved 2020-03-03.
  2. ^ "Rajnish Mehra". 2020-03-12.
  3. ^ "People – UCSB Department of Economics".
  4. ^ "Rajnish Mehra". National Council of Applied Economic Research. Retrieved 2023-10-28.
  5. ^ Stokey, Nancy, Robert Lucas and Edward C. Prescott (1989). Recursive Methods in Economic Dynamics. Harvard University Press. ISBN 978-0-674-75096-8.{{cite book}}: CS1 maint: multiple names: authors list (link)
  6. ^ Sargent, Thomas J. and Lars Ljungquist (2000). Recursive Macroeconomic Theory. MIT Press. ISBN 978-0-262-12274-0.
  7. ^ Mehra, R. (2020). Vernengo, Matias; Caldentey, Esteban Perez; Rosser Jr, Barkley J (eds.). Recursive Competitive Equilibrium. In Palgrave Macmillan (eds.) The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. doi:10.1057/978-1-349-95121-5. ISBN 978-1-349-95121-5. S2CID 241427068.
  8. ^ Prescott, Edward C. & Mehra, Rajnish (1980). "Recursive Competitive Equilibrium: The Case of Homogeneous Households" (PDF). Econometrica. 48 (6): 1365–79. doi:10.2307/1912812. JSTOR 1912812.
  9. ^ Mehra, Rajnish; Edward C. Prescott (1985). "The Equity Premium: A Puzzle" (PDF). Journal of Monetary Economics. 15 (2): 145–161. doi:10.1016/0304-3932(85)90061-3.
  10. ^ Mehra, Rajnish (2008). Handbook of the Equity Risk Premium. Elsevier. ISBN 978-0-444-50899-7.
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