United States

Economist Michael Haliassos: In the World of Finance, Households Matter

September 16, 2023

Michael Haliassos is one of a number of Hellenes who are renowned economists making substantial contributions to their field and society. He was born in 1959 and grew up in Athens. His father, Lambros, worked for the Bank of Greece. Michael has roots in a remote village in Evrytania and his education was made possible by his grandfather’s courageous decision to spend 13 years alone in the United States, first working on the railroad and then running a hot dog stand.

His mother, Evangelia, was born in Thessaloniki. His parents made considerable financial sacrifices to educate him at Athens College and then at Cambridge and Yale until he began to receive full scholarships and assistantships – their commitment to education has shaped his life.

He was extremely fortunate to be mentored by three Nobel laureates: Oliver Hart as an undergraduate and James Tobin and William Nordhaus as a graduate student.

Michael Haliassos speaking at the conference of Athens Chamber of Commerce and Industry in 2019.

The National Herald: Tell us about your family.

Michael Haliassos: I met my wife, Ioanna Pantazi Haliassou, at the University of Maryland College Park, where she received her PhD in clinical psychology.
We have two grown children: Eva, 32, who is a creative development manager at Warner Bros, and Alexandros, 27, who is finishing his PhD in Machine Learning and Computer Vision at Imperial, both in London.
We moved to Cyprus in 1993 and I was able to participate extensively in building the country’s first public university. In December 2004, I moved to the Goethe University Frankfurt to take up the Chair of Macroeconomics and Finance. I have been active in building my School in Frankfurt, as well as in leading research and policy centers. I also advise the European Central Bank on building and analyzing a comprehensive Eurozone database on household finances.


Michael Haliassos, left, being awarded the prize of the city of Frankfurt for people with immigrant background by the Mayor 2017.

TNH: Tells us about your interest in Greece and Cyprus

MH: I continue to assist Greece and Cyprus. In 2010-13, I was the youngest member of the Greek National Council for Research and Technology, chaired by Stamatis Krimigis. For nine years I was a member of the Cyprus Council for the Accreditation and Evaluation of Private Universities. I am now Vice President of a new network called Komvos: Networks of Global Hellenism, which aims to launch projects that have a substantial impact on various aspects of Greek life.

TNH: You are the founding director of the CEPR Network on Household Finance. What does it involve?

MH: The Center for Economic Policy Research is the leading European network for research in economics and finance. In 2015, I invited to Frankfurt European researchers who had been instrumental in launching research on household finance, and I proposed that we form a pan-European network. They happily agreed, and so did CEPR. We organize two major conferences per year, as well as events that link household finance research to policy. We also support young researchers, for example by awarding an annual prize for the best PhD thesis in household finance. We are open to working with initiatives that empower households in their financial behavior. I got our network involved in the Think Forward Initiative, which was launched in 2016 by ING, Deloitte, Dell/EMC, Microsoft, Microsoft, and Amazon Web Services to support academic research and start-ups that could empower households. In its five years of operation, TFI reached more than 100 million people worldwide and influenced the behavior of just under 8 million. It was unfortunately discontinued in 2021 due to a change in leadership at one of the key private sector partners. My leadership style in the network is simple: I try to conduct and encourage research and dissemination, while making sure that I never get to the point where I alone can decide which paper to include or which project to fund. Collaboration is a key to success.

Michael Haliassos with Prof. Chryssi Giannitsarou in Keynes apartment, Cambridge University.

TNH: What are your research interests?

MH: By training, I am a macroeconomist with an interest in monetary and financial economics. As an assistant professor, I realized that I was caught up in the battles of the day between different approaches to macroeconomics, so, I tried to think of a topic for the (then) future, and I came up with financial asset and debt participation of households. In the beginning, referees did not know how to classify such papers. Now there is a Journal of Economic Literature code for household finance (G5), and more papers come out every month than I can hope to read. The field has been lucky – resarchers and policymakers recognized the importance of retirement savings because of the demographic transition (i.e., too few workers contributing to the pensions of too many retirees). Tremendous financial innovation created both opportunities and challenges for households. Policymakers realized that financial stability and the impact of macroeconomic policies depended critically on household portfolio composition and on the distribution of wealth. The private financial sector began to realize that they needed to better understand the behavior of their customers. Computational research methods have improved dramatically, allowing us to solve models that were impossible to solve analytically. As a result, there is methods, data, research, and policy interest, and substantial funding for household finance research, from the United States and Europe to Australia, China, Japan, and India. There is interest in the finances of the rich and of the poor. But most importantly, there is interest among young people, of all genders and races. There is a recognition that we all need to make financial decisions and learn how to manage opportunities and risks without being destroyed by them. Robert Shiller, a fourth Nobel laureate whom I met at Yale, calls this the ‘democratization of finance’.

Michael Haliassos with the members of ESET and Anna Diamantopoulou visited President Papoulias in 2010.

TNH: What topics have you researched?

MH: I have studied the limited participation of households in stock markets around the world, and the surprising ways in which households combine low-interest savings and high-interest debt. I have decomposed international differences in household portfolios into those that arise from population characteristics and those that arise from differences in institutional and policy environments, as well as cultural differences. I have studied how peers influence our own financial behavior, positively or negatively, by providing information or creating envy; and how wealth inequality is interpreted by people with and without a college education: as an opportunity or as an injustice. I have also provided evidence that financial advice, on average, worsens portfolio behavior when controlling for investor characteristics, and that it tends not to be provided to those who need it most: the inexperienced and the financially vulnerable. Finally, I am studying the impact of stress on financial decisions: does it make us less or more cautious?

Michael Haliassos with the Founders of the CEPR Network on Household Finance in Frankfurt.

TNH: What international book projects have you coordinated?

MH: The first, ‘Household Portfolios’, was an MIT Press volume of papers that three of us commissioned to launch the field of household finance, followed by a smaller project on stockholding in Europe. I then had the honor of editing an MIT Press volume titled ‘Financial Innovation: Too Much or Too Little?’, which featured Robert Shiller, among others. I then edited a 3-volume collection of articles that have shaped household finance. Finally, I co-edited a volume on financial regulation and another on the Capital Markets Union of the EU.

TNH: What do you appreciate in people?

MH: Honesty, impartial judgement, consistency, commitment, and a collaborative spirit.

TNH: What is life’s essence?

MH: To be able to improve the lives of others without destroying your own.


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