In the News

In this co-authored op-ed, Finance Professor Adair Morse writes that by pulling out of net zero alliances en masse, the banking sector appears to be doing an about-face on lending to decarbonizing projects. But the authors asked why banks were in net zero alliances—a group of leading global banks committed to aligning their lending, investment, and capital markets activities with net-zero greenhouse gas emissions by 2050—in the first place. New research Morse co-authored with Parinitha Sastry, assistant professor of finance at Columbia Business School, analyzed the economics of net zero bank lending by weaving together findings from over 130 academic studies.

President Donald Trump's team is reportedly planning a "Mar-a-Lago Accord" aimed at devaluing the U.S. dollar to boost industrial competitiveness and revive domestic manufacturing. Modeled loosely on Ronald Reagan's 1985 Plaza Accord, the plan seeks to pressure global partners to support the dollar’s devaluation and adopt measures that benefit American economic interests. The plan runs counter to the principles of free market economics, which Trump invokes. "Nothing is unthinkable anymore with Trump, especially when it comes to putting his own business interests first and disrupting the rules-based order," said Ulrike Malmendier, the Cora Jane Flood Professor of Finance and an economic advisor to the German government.

Artificial Intelligence (AI) is transforming the world by mimicking human cognitive processes, but it also reflects the biases of the humans who program it. This article references a 2021 analysis conducted by the Berkeley Haas Center for Equity, Gender and Leadership. In their analysis of around 133 systems across industries from 1988 to 2021, they found that 44.2% (59 systems) demonstrated gender bias, with 25.7% (34 systems) exhibiting both gender and racial bias. According to an article co-written that same year by professional faculty member Genevieve Smith, "gender-biased AI not only has immense impacts on individuals but also can contribute to setbacks in gender equality and women’s empowerment."

Ulrike Malmendier, the Cora Jane Flood Professor of Finance and an economic advisor to the German government, asserts that Germany must pursue long-term investments in education, digitalization, infrastructure, and tax reform to regain economic competitiveness and attract foreign investment. Drawing parallels to former Chancellor Gerhard Schröder's transformative yet controversial "Agenda 2010" reforms, Malmendier urges bold action accompanied by social policies to support affected groups, highlighting the risk of societal polarization if changes are mishandled. "If we don’t start investing in things that don’t benefit politicians or even the public today but will pay off in the long run, Germany will continue its decline," she warns.

Research by Terrance Odean, the Rudd Family Foundation Professor of Finance, is referenced in this article about how women are increasingly investing in the stock market, with 71% of women participating as of 2024. Odean's research showed that women often outperform men in investment returns due to their cautious, long-term strategies and lower risk-taking behaviors, such as favoring stable assets and avoiding impulsive trades during market volatility. The article highlights the financial challenges women still face such as the gender pay gap, accumulating less wealth than men, and biased treatment by financial advisors.

A recent analysis highlights that female cryptocurrency investors often outperform men due to their cautious and long-term investment strategies. It references a 2001 study co-written by Professor Terrance Odean. Odean and colleagues analyzed the trading data of more than 35,000 household accounts of a large U.S. discount brokerage firm, split investors by gender, and came to a thought-provoking conclusion: Men generally lose more than women. The study showed that overconfidence frequently led male investors to engage in high-frequency, high-risk trading, which increased costs and exposure to market fluctuations.

More than 100 Jewish faculty and staff members at UC Berkeley have signed a statement opposing deportations of student protesters, which have been proposed by the Trump administration as part of its efforts to "combat antisemitism" on university campuses. Professor Steven Tadelis, the Sarin Chair in Leadership and Strategy, was one of the initial signatories and drafters of the statement. He echoed the Jewish faculty’s rejection of deportation on the basis of political views and opposed the “compiling of lists” that has been used throughout history to target vulnerable individuals. “I hope it conveys that as Jews, we take seriously the lessons of our own history, where targeting individuals, compiling lists, and suppressing dissent have led to grave consequences,” he wrote in an email.

Importers are rushing to offload goods amid an escalating trade war between the U.S. and China—the world's two largest economies. President Trump's recent tariffs on Chinese imports, escalating to 20%, have created uncertainty for trade-dependent industries and ports like Oakland, which handles 48% of its imports from China. Trump's use of tariffs has been an effort to restore American manufacturing jobs and protect key industries, according to Professor Matilde Bombardini, the Oliver E. and Dolores Williamson Chair in the Economics of Organizations, but the sheer breadth of tariffs on all goods from China has stoked concern about reigniting inflation. "Tariffs could be a big, big obstacle to bringing down inflation back to 2%, and we're already seeing an uptick," Bombardini said, noting that inflation had leveled out at 3.1% at the end of 2024. "It's a very delicate moment."

California residents face skyrocketing electricity rates as major utilities like PG&E, SCE, and SDG&E report record profits, driven by costly grid upgrades, wildfire prevention, and clean energy investments. Severin Borenstein, Professor of the Graduate School, highlights that rising utility costs in California are largely driven by investments in low-voltage distribution grids and wildfire mitigation efforts. "Those last two sort of meld together because we're spending a whole lot of money on upgrading our distribution network, reinforcing our distribution network, in some cases, under-grounding it, in order to reduce wildfires,” he said.

The article discusses the economic tensions stemming from escalating trade tariffs between the United States and China, with significant impacts on the Port of Oakland, a major hub for Northern California imports and exports where imports from China make up nearly half of all goods arriving at the port. President Donald Trump recently imposed 10% tariffs on Chinese goods, later doubling them to 20%, prompting retaliatory measures from China and raising concerns about inflation, supply chain disruptions, and potential economic recession. Professor of Business and Public Policy Matilde Bombardini, who studies international trade and comparative advantages, believes the president’s use of tariffs has been an effort to restore American manufacturing jobs and protect key industries. “The decline in manufacturing was one of the primary sources of discontent among lower- and middle-class Americans – tariffs could in principle protect from foreign competition, and then you could increase manufacturing jobs at home,” she said.

Professor Matilde Bombardini is one of over 600 signatories to an open letter arguing that American and European security and values are on the line in Ukraine. The letter argues that the West as a whole must respond to Russia's aggression with a comprehensive strategy to eliminate the threat of Russia. The article emphasizes that protecting Ukraine’s sovereignty is integral to ensuring global security, stability, and the survival of Western values.

Ben Meng, MFE 02, an experienced investment executive and former CIO of CalPERS, was recently appointed as the head of investment portfolio management at the Canada Pension Plan Investment Board (CPPIB). CPPIB is Canada’s largest pension fund with C$700 billion in assets. Meng will oversee active investment strategies, including equities, credit, private equity, and infrastructure.

For months, the surge in egg prices have made headlines. The Justice Department is investigating potential antitrust violations by egg producers, but experts caution that high prices alone don't imply collusion. The price elasticity of eggs is extraordinarily low, meaning that demand remains steady even with extreme price hikes—228% price increases only reduced purchases by only 4%, according to research by Aaron Smith, a faculty affiliate of the Energy Institute at Haas and Professor of Agricultural and Resource Economics. "Egg demand is inelastic because there are few good substitutes and it doesn't take up a huge portion of most people's budget," he wrote. While it's not pleasant to pay more for eggs – most people are willing and able to do it."

President Trump's executive orders to dismantle DEI initiatives have left brands scrambling to find messaging workarounds that protect both their values and their reputations. Companies are shifting language, such as using "belonging" instead of "inclusion," and are doubling down on initiatives that align with their business goals, including diverse hiring and marketing strategies to reach specific audiences. "A CEO of a large tech company with government contracts recently told me that the company is pausing all external communications on DEI until someone figures out what’s legal and illegal - so externally, they are under the radar. But they are not doing anything differently, internally, except changing the way they talk about DEI,” said Lecturer Kellie McElhaney, founding director of the Center for Equity, Gender, and Leadership.

The backlash against Tesla due to CEO Elon Musk's controversial actions and political alliances continues. Anti-Musk sentiment has transformed Tesla cars into cultural symbols, with critics labeling them as “rolling MAGA hats,” sparking protests, vandalism, and declining demand. Tesla’s stock has dropped 30% this year, reflecting diminished investor confidence. Bill Pearce, a professional faculty member and former CMO at Berkeley Haas, Del Monte, and Taco Bell noted that Tesla has suffered a more dramatic slump in Europe than in the U.S., with sales sputtering in Germany and Norway, among other nations. “If you bought a Tesla as an expression of what you believe in—being concerned about the environment and doing something better for humanity—then it’s not shocking that you’re having a visceral reaction,” he said. All the same, he marvels at people’s urgency to sell right away, even if it means losing up to $10,000 on their purchase.