Mitchell A. Petersen
Mitchell A. Petersen

FINANCE
Glen Vasel Professor of Finance
Director of the Heizer Center for Private Equity and Venture Capital

Print Overview

Mitchell Petersen is the Glen Vasel Professor of Finance. He has published widely in finance and economics. Professor Petersen's research is in the area of empirical corporate finance-the questions of how firms evaluate potential investment projects and how they fund such projects. His recent writing focuses on the funding of small firms and how such funding has been altered by technology and changes in the financial (banking) market. He was awarded the Smith-Breeden Prize for Outstanding Paper in the Journal of Finance in 1995 (for his paper "The Benefits of Lending Relationships: Evidence from Small Business Data") and the Michael Brennan Award for Best Paper in the Review of Financial Studies in 1998 (for his paper "Trade Credit: Theories and Evidence"). He was runner-up for the Brennan Award in 2008 (for his paper “Does the Source of Capital Affect Capital Structure”) and 2010 (for his paper “Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches”).

He has been a member of the editorial board of various journals, including the Journal of Finance, Financial Management, Review of Financial Studies and the Journal of Financial Intermediation. He is also a research associate with the National Bureau of Economic Research (NBER) and is a member of the Moody's Academic Advisory and Research Committee and served on the Board of Directors of L.R. Nelson.

Professor Petersen was awarded the Sidney J. Levy Teaching Award in 1996, 1999, 2001, 2003, 2006, 2008, 2010, and 2012 and was voted the Kellogg Professor of the Year in 2000, the Executive MBA Outstanding Professor in 2008, 2010, and 2011, and Kellogg Alumni Professor of the Year in 2010. He received his Ph.D. in Economics from the Massachusetts Institute of Technology. Prior to joining Kellogg Professor Petersen taught at the University of Chicago.



Areas of Expertise
Banking and Financial Institutions
Corporate Bankruptcy
Corporate Capital Structure
Corporate Finance
Debt-Equity Choice
Entrepreneurship
Payout Policy (Dividends, Repurchases)
Pension Funds
Real Options (Investments)
Risk Management
Small Business Management
Taxation

Print Vita
Education
PhD, 1990, Economics, Massachusetts Institute of Technology
AB, 1986, Economics, Princeton University, Summa Cum Laude, Phi Beta Kappa

Academic Positions
Director of Heizer Center for Private Equity and Venture Capital, Kellogg School of Management, Northwestern University, 2007-present
Glen E. Vasel Professor of Finance, Kellogg School of Management, Northwestern University, 2005-present
Glen E. Vasel Associate Professor of Finance, Kellogg School of Management, Northwestern University, 1997-2005
Assistant Professor of Finance, Kellogg School of Management, Northwestern University, 1994-1997
Assistant Professor of Finance, Graduate School of Business, University of Chicago, 1990-1994

Grants and Awards
BGI - Michael Brennan Award - Best Paper, Review of Financial Studies
Executive MBA Program Outstanding Teaching Awards, Kellogg School of Management, 2014, 2011, 2010, 2008
Kellogg Alumni Professor of the Year Award, Kellogg School of Managment, 2010
Sidney J. Levy Teaching Award, Kellogg School of Management, 2012, 2009-2010, 2007-2008, 2005-2006, 2003-2004, 2000-2001, 1998-1999, 1995-1996
Editor's Choice Award, Review of Financial Studies, 2010
Michael Brennan Award (runner-up), Barclays Global Investors, 2010
Sidney J. Levy Teaching Award, Kellogg School of Business and Management, 2003
Sidney J. Levy Teaching Award, Kellogg School of Business and Management, 2001
L.G. Lavengood Outstanding Professor of the Year Award, Kellogg School of Management, 2000
Outstanding Professor of the Year, Kellogg School of Business and Management, 2000
Sidney J. Levy Teaching Award, Kellogg School of Business and Management, 1999
Michael Brennan Award, Barclays Global Investors, 1998
Sidney J. Levy Teaching Award, Kellogg School of Business and Management, 1996
Smith Breeden Distinguished Paper Award, American Finance Association, 1995

Editorial Positions
Associate Editor, Journal of Finance, 2004-2013
Associate Editor, Financial Management, 2002-2009
Editor, Journal of Financial Management, 1998-2002
Associate Editor, Review of Financial Studies, 1995-1997

Print Research
Research Interests
Empirical corporate finance (how firms, especially small firms, are financed and, risk management, and the role of debt markets in funding investments)

Articles
Petersen, Mitchell A and Michael Faulkender. 2012. Investment and Capital Constraints: Repatriations Under the American Jobs Creation Act. Review of Financial Studies. 25(11): 3351-3388.
Petersen, Mitchell A. 2009. Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches. Review of Financial Studies. 22: 435-480.
Faulkender, Michael and Mitchell A Petersen. 2006. Does the Source of Capital Affect Capital Structure?. Review of Financial Studies. 19(1): 45-79.
Berger, Allen, Nathan Miller, Mitchell A Petersen, Raghuram G. Rajan and Jeremy Stein. 2005. Does Function Follow Organizational Form? Evidence From the Lending Practices of Large and Small Banks. Journal of Financial Economics. 76(2): 237-269.
Petersen, Mitchell A and Raghuram G. Rajan. 2002. Does Distance Still Matter? The Information Revolution in Small Business Lending. Journal of Finance. 57(6): 2533-2570.
Petersen, Mitchell A and S.Ramu Thiagarajan. 2000. Risk Measurement and Hedging: With and Without Derivatives. Financial Management. 29(4): 5-29.
Petersen, Mitchell A. 1999. Banking Consolidation and Small Firm Finance: Discussion of 'How Important are Small Banks to Small Business Lending?' New Evidence from a Survey of Small Firms, by Jith Jayarantne and John Wolken. Journal of Banking and Finance. 2
Petersen, Mitchell A. 1999. Banks and the Role of Lending Relationships: Evidence from the U.S. Experience. Rassegna Economica. 63(1): 37-62.
Petersen, Mitchell A and Raghuram G. Rajan. 1997. Trade Credit: Theories and Evidence. Review of Financial Studies. 10(3): 661-691.
Petersen, Mitchell A and Raghuram G. Rajan. 1995. The Effect of Credit Market Competition on Lending Relationships. Quarterly Journal of Economics. 110(2): 407-443.
Petersen, Mitchell A. 1994. Cash flow Variability and Firm's Pension Choice: A Role for Operating Leverage. Journal of Financial Economics. 36(3): 361-383.
Fialkowski, David and Mitchell A Petersen. 1994. Posted versus Effective Spreads: Good Prices or Bad Quotes?. Journal of Financial Economics. 35(3): 269-292.
Petersen, Mitchell A and Raghuram G. Rajan. 1994. The Benefits of Lending Relationships: Evidence from Small Business Data. Journal of Finance. 49(1): 3-37.
Petersen, Mitchell A. 1992. Pension Reversions and Worker-Stockholder Wealth Transfers. Quarterly Journal of Economics. 107(3): 1033-1056.
Working Papers
Petersen, Mitchell A and Justin Murfin. 2014. Loans on sale: Credit market seasonality, borrower need, and lender rent seeking.
Petersen, Mitchell A. 2004. Information: Hard and Soft.
Book Chapters
Petersen, Mitchell A. 1996. "Allocating Assets and Discounting Cash Flows: Pension Plan Finance." In Pensions, Savings, and Capital Markets, edited by Phyllis Hernandez, John Turner, Richard Hinz, Washington, DC: US Department of Labor.
Petersen, Mitchell A. 1996. "Do 401(k) Plans Replace Other Employer-Provided Pensions?." In Advances in the Economics of Aging, edited by David A. Wise, 219-240. Chicago, IL: University of Chicago Press.
Cases
Petersen, Mitchell A.. 2004. Western-Southern Enterprise. Case 5-104-019 (KEL075).
Petersen, Mitchell A. and Robert O'Keef. 2004. West Teleservices. Case 5-104-020 (KEL074).
Petersen, Mitchell A.. 2014. Teuer Furniture (A): Discounted Cash Flow Valuation. Case 5-313-509(A) (KEL778).
Petersen, Mitchell A. and Rashmi Singhal. 2007. Vioxx: Too Risky for Merck?. Case 5-207-253 (KEL289).
Furfine, Craig and Mitchell A. Petersen. 2014. The Right of Acquisition: Options in Commercial Real Estate. Case 5-114-001 (KEL819).
Petersen, Mitchell A., Rajiv Chopra and Alex Williamson. 2013. Grupo Pão de Açúcar: Strategic Use of Trade Credit. Case 5-312-508 (KEL744).
Petersen, Mitchell A.. 2014. Teuer Furniture (B): Multiples Valuation. Case 5-313-509(B) (KEL788).

 
Print Teaching
Teaching Interests
Corporate finance (valuation, capital structure, and dividend policy), tax strategy, real options
Full-Time / Part-Time MBA
Accelerated Corporate Finance (FINC-440-0)
Corporate finance covers the financial knowledge you need to run a firm, whether the firm is a multi-billion dollar international conglomerate or a three-person start up. Accelerated Corporate Finance will combine the material from Finance 1 and Finance 2 in an intensive one-quarter course. We will cover valuation (discounted cash flow, multiples, and real options), capital structure (how firms finance themselves and how they manage risk), and payout policy (should firms return capital to investors and if so how). For more details, you should read the descriptions of Finance 1 and Finance 2. The logical concepts will be covered in class, technical skills and intuition will be developed in class and through online exercises, and then the logic and tools will be applied to a set of valuation, financing, risk management, and payout cases. Given the pace of the course, students are expected to be prepared to put in the extra effort in class and outside of class. Basic finance knowledge (discounting) and accounting is assumed

Pre-requisite: Business Analytics I (DECS-430). Business Analytics II (DECS-431) and Accounting for Decision Making (ACCT-430) are recommended and may be taken concurrently.

Financial Strategy and Tax (FINC-447-0)
This course examines the role of taxes in a firm's financial strategy. Tax knowledge is not a prerequisite, and we do not cover the specifics of any one tax code. Instead we study the basic structure of tax codes and identify the fundamental sources of gains from tax planning. General principles are illustrated with examples from past and current tax law in the United States and other countries. Real examples of tax planning and cases are used. We study financial decisions such as the choice of organizational form, investments in real and financial assets, and different methods of financial investments.

FINC-465-0 is a prerequisite for this course, but they may be taken concurrently. If you take Derivatives I concurrently, you are responsible for reading ahead in the Derivatives class and knowing the material. I will begin using the material from Derivatives I in the first week. You need to be sure you are up to speed quickly. I also recommend you include someone in your group that has taken Derivatives I in a prior quarter. To bid for FINC447, you will need to be granted a temporary waiver of FINC-465 (Derivatives I). The process is outlined in the Serial under Academics -> Bidding & Registration. First submit your bid for FINC-465 and then email the registrar and request a temporary waiver of FINC-465 so you can registrar for FINC-447. The registrar will then confirm that you have bid on FINC-465 and apply the necessary waiver to your account so that you are allowed to bid on FINC-447. The registrar will email you once the waiver has been applied.

Executive MBA
Managerial Finance II (FINCX-441-0)
Managerial Finance II analyzes corporate financial decisions. Topics include market efficiency, capital structure, dividend and stock repurchase policy, and firms’ use of options and convertible securities.

Strategic Financial Management (FINCX-442-0)
Strategic Financial Management examines financial management theory and cases. Students use valuation skills to determine the cost of capital, financing and operating issues faced by the firm.

Executive Education
Advanced Management Program: Intensive

A condensed and immersive professional development opportunity for senior executives responsible for creating markets and driving growth in today's fast-paced, interconnected economy. A holistic approach to assessing the organizational impact of one's leadership skills and style, all supported with executive coaching.


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Advanced Management Program: The Global Experience

Kellogg offers the same core leadership content for senior executives as our Advanced Management Program: Intensive in a modular format that includes an additional week of programming. This breakthrough course design provides an unparalleled experiential global week of learning in select markets around the world.


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Business for Scientists and Engineers
Develop the business acumen to advance your life’s work. In this collaborative program, you will gain skills in marketing, leadership, finance and other management areas to build on your expertise in science or engineering. Covering topics such as taking innovation from bench to market, launching a startup, managing intellectual property and implementing negotiation strategies, this program will arm you with the tools and frameworks to face new challenges and embrace new opportunities.
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Corporate Finance: Strategies for Creating Shareholder Value
Learn the latest methodologies – and their real-world applications – for analyzing and valuing financial decisions.

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Executive Development Program
Equipping high-potential middle to senior managers with the business knowledge and leadership skills they need to succeed in general management. Explore theory-driven knowledge and concrete strategies across all business areas and return to your workplace equipped and energized to continue to advance as a leader, decision maker and change agent.
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Women's Senior Leadership Program
With an emphasis on practical learning and talent development, this four-part program — strategically paced over the course of a year — equips women with the knowledge and tools needed to elevate themselves to the C-suite and beyond. Strengthen and broaden your leadership talents through this rigorous program of intensive classroom instruction, individual career appraisals, personal coaching, case studies and simulations.
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