Brian Melzer
Brian Melzer

Adjunct Professor of Finance

Print Overview

Brian Melzer is an adprofessor in the Finance Department. He studies household finance, with a particular focus on household borrowing, housing investments, and financial advice. His work has examined the impact of payday loans on household well-being, the default and investment behavior of heavily indebted homeowners, and the effects of unemployment insurance on loan default and credit supply. His current research examines the costs and benefits of financial advice. His articles have been published in leading economics and finance journals such as the Quarterly Journal of Economics, the Journal of Finance, and the Review of Financial Studies.

Professor Melzer received a Ph.D. in Economics from the University of Chicago Graduate School of Business in 2008. Prior to pursuing his Ph.D., he received undergraduate and master's degrees in philosophy from Princeton University and the University of St Andrews. He also worked as a research analyst in investment management.

Areas of Expertise
Banking and Financial Institutions
Corporate Finance
Household Finance
Regulation of Financial Markets

Print Vita
PhD, 2008, Economics, University of Chicago
MLitt, 2000, Philosophy, University of St Andrews
AB, 1999, Philosophy, Princeton University, Summa Cum Laude

Academic Positions
Affiliate, Center for Applied Microeconomics, Economics, Northwestern University, 2016-present
Faculty Associate, Institute for Policy Research, Northwestern University, 2014-present
Affiliate, Center for the Study of Industrial Organization, Northwestern University, 2014-present
Assistant Professor of Finance, Kellogg School of Management, Northwestern University, 2008-present

Other Professional Experience
Portfolio Analyst, ABP Investments US, Inc., 2003-2003
Research Analyst, Dawson-Giammalva Capital Management, Inc., 2001-2003

Honors and Awards
2015 Canadian Investment Research Award, CFA Society Toronto & Hillsdale Investment Management

Print Research
Research Interests

Household finance; real estate; financial institutions; financial regulation

Melzer, Brian. 2011. The Real Costs of Credit Access: Evidence from the Payday Lending Market. Quarterly Journal of Economics. 126(1): 517-555.
Melzer, Brian and Donald P. Morgan. 2015. Competition in a Consumer Loan Market: Payday Loans and Overdraft Credit. Journal of Financial Intermediation. 24(1): 25-44.
Melzer, Brian. 2017. Mortgage Debt Overhang: Reduced Investment by Homeowners at Risk of Default. Journal of Finance. 72(2): 575-612.
Foerster, Stephen, Juhani Linnainmaa, Brian Melzer and Alessandro Previtero. Forthcoming. Retail Financial Advice: Does One Size Fit All?. Journal of Finance.
Melzer, Brian. Forthcoming. Spillovers from Costly Credit. Review of Financial Studies.
Hsu, Joanne W., David A. Matsa and Brian Melzer. 2018. Unemployment Insurance as a Housing Market Stabilizer. American Economic Review. 108(1): 49-81.
Working Papers
Linnainmaa, Juhani, Brian Melzer and Alessandro Previtero. 2016. The Misguided Beliefs of Financial Advisors.
Green, Daniel, Brian Melzer, Jonathan A. Parker and Arcenis Rojas. 2016. Accelerator or Brake? Cash for Clunkers, Household Liquidity, and Aggregate Demand.
Melzer, Brian and Aaron Schroeder. 2015. Loan Contracting in the Presence of Usury Limits: Evidence from the Auto Loan Market.
Kuhnen, Camelia M. and Brian Melzer. 2016. Non-Cognitive Abilities and Financial Delinquency: The Role of Self-Efficacy in Avoiding Financial Distress.
Benmelech, Efraim, Adam Guren and Brian Melzer. 2017. Making the House a Home: The Stimulative Effect of Home Purchases on Consumption and Investment.
Melzer, Brian. "Payday Loans Increase SNAP, Reduce Child Support Payments." UC Davis Center for Poverty Research Policy Brief.

Print Teaching
Teaching Interests
Corporate finance
Full-Time / Evening & Weekend MBA
Finance II (FINC-431-0)

**This version of Finance II is designed for students who took Finance I during or after Fall 2014**

Finance II: Corporate Finance covers the financial knowledge you need to run a firm, whether the firm is a multi-billion international conglomerate or a three-person start up. You will learn how to answer the three fundamental question of corporate finance: (1) Capital structure or the funding decision: which source(s) of capital should you use to fund the firm's project? (2) Capital budgeting or the investment decision: which projects should you invest in? (3) Dividend decision: how should you deploy the capital that the project returns?

We will cover the three fundamental methods for valuing projects and firms: discounted cash flow (or net present value), real options, and multiples analysis. The class begins with a theoretical framework. The world of finance is very complex. Without a logical structure that you can use to frame and answer questions, you will rapidly become lost and will be unable to defend your position. The theoretical framework is valuable, however, only if you can use it to examine real world decisions. Thus the majority of class time will be devoted to applying the logical framework.

This course is important for anyone who plans to run a firm or a division, who hopes to be involved in the investment or funding decisions of the firm, who plans to work for a service provider who will assist the firm in analyzing these decisions (e.g., banking and consulting), or who plans to invest in firms or advise clients who will invest in firms. Even if you initially specialize in a different functional area, you want to understand how the finance function works. The most brilliant idea isn't useful if you cannot get it funded.

Recommended Prerequisites: ACCT-430 and MECN-430