What's Hot in Finance (2011-2015)?

Abstract

To catalyze my fourth-year Ph.D. students in the Hong Kong University of Science and Technology to think of new ideas after their comprehensive examinations, I asked each one of them to read the abstracts of finance articles published in the last 5 years in JF, JFE, RFS and JFQA. Here are some general observations from the hard data in the attached slides and the soft data generated in our discussion: 1) The journals are not as US-centric as commonly believed in Asia. Empirical papers using non-US data have risen to about 17% of all empirical papers, and this number is about the same in all 4 journals. 2) The number of authors per article is trending up, with the mean being about 2.6. 3) Classification is very difficult. There are more papers published which are not only intra-discipline but also inter-disciplinary. Macro-banking-finance is the hottest inter-disciplinary topic. 4) The ratio between theory to empirical is highest in RFS (about 1:2) and lowest in JFQA (about 1:6). No trends are discernible in asset pricing, but less theory papers are being published in corporate finance. 5) In corporate finance, the dominance of the old chestnuts – capital structure and corporate governance – is trending down. M&A is popular. Links between markets, banks and firms is a hot new area. 6) In asset pricing, identification of new sources of risk, and pricing of non-equity assets are hot new areas. 7) In investments, hedge funds, venture capital and private equity are hot. 8)) High frequency trading has resuscitated the market microstructure area. 9) Niche areas like household finance, culture and finance, politics and finance, labor and finance, media and finance, networks and finance, are not niche anymore. 10) Amongst finance journals, JF is No 1 followed by the RFS. 11) Top non-finance journals like the AER, JPE, QJE and Management Science publish many finance papers. With the notable exception of QJE, these journals now have lower impact factors than the top 3 finance journals.

Keywords: corporate finance, asset pricing, investments, market microstructure, financial intermediation

JEL Classification: G10, G20, G30