Christopher Hennessy

Professor of Finance

BA (Swarthmore) MA PhD (Princeton)

Professor Christopher Hennessy's research focuses on information economics, moral hazard and debt, debt restructuring, tax planning, financing dynamics and credit risk. His work has been published in the Journal of Finance, Journal of Financial Economics and the Review of Financial Studies. He is a three-time winner of the Brattle Prize for outstanding corporate finance research and was named one of four rising stars in financial economics for 2010.

He is a Professor of Finance at London Business School and formerly Associate Professor and Finance Area Chair at the Walter A Haas School of Business at University of California, Berkeley. He holds a Master of Public Affairs degree and a PhD in Economics from Princeton University.

Professor Hennessy is currently editor of the Review of Corporate Finance Studies and associate editor of the Review of Finance, Finance Research Letters, and Management Science. He is also a research fellow at the Centre for Economic Policy Research in London and the European Corporate Governance Institute. He is a regular visitor at the Vienna Graduate School of Finance and University of Paris-Dauphine.

Formerly a senior associate at KPMG Peat Marwick and research analyst at the United States Treasury Office of Tax Analysis, Professor Hennessy has chaired the academic advisory board at Acumen Global Partners – a London-based derivatives advisory boutique – and served on the academic advisory panel of Benchmark Metrics. He recently received a grant from the European Research Council to study the affect of tax changes on corporate financing decisions.

Research Awards

European Research Council Starting Independent Researcher Grant, 2011-2015.
Finance Rising Star Award, 2010.
Brattle Prize (Outstanding Paper in Journal of Finance), 2004, 2005, and 2007.
Barbara and Gerson Bakar Faculty Fellow for 2008, University of California, Berkeley.
Guttmann Fellow, 2007, Vienna.
Schwabacher Fellow, University of California, Berkeley, 2006.
Junior Faculty Research Grant, University of California, Berkeley, 2004 and 2005.
Beinkecke Fellowship, 1992-1994.
Phi Beta Kappa, Swarthmore College, 1992.
Chicago Business Fellow, 1991.
Academic All-American, 1988.

Taxation
Valuation of convertible and callable debt
Dynamic capital structure
Information economics

2023

Goodhart’s Law and Machine Learning: A Structural Perspective

Hennessy C; Goodhart C

International Economic Review 2023 Vol 64:3 p 1075-1086

2022

Markets versus Mechanisms

Boleslavsky R; Hennessy C A; Kelly D L

Review of Financial Studies 2022 Vol 35:7 p 3139-3174

Signaling, instrumentation, and CFO decision-making

Hennessy C; Chemla G

Journal of Financial Economics 2022 Vol 144:3 p 849-863

2021

Equilibrium Counterfactuals

Hennessy C; Chemla G

International Economic Review 2021 Vol 62:2 p 639-669

2020

2019

Controls, belief updating, and bias in medical RCTs

Chemla G; Hennessy C A

Journal of Economic Theory 2019 Vol 184

2018

Learning and leverage cycles in general equilibrium: theory and evidence

Hennessy C A; Radnaev B

Review of Finance 2018 Vol 22:1 p 311-335

2016

Government as a borrower of first resort

Chemla G; Hennessy C

Journal of Monetary Economics 2016 Vol 84 p 1-16

Secondary market liquidity and security design: theory and evidence from ABS markets

Friewald N; Hennessy C; Jankowitsch R

Review of Financial Studies 2016 Vol 29:5 p 1254-1290

2014

Skin in the game and moral hazard

Chemla G; Hennessy C

Journal of Finance 2014 July Vol 69:4 p 1597-1641

2013

Model before measurement

Hennessy C

Critical Finance Review 2013 Vol 2:1 p 193-215

2011

A theory of debt market liquidity and leverage cyclicality

Hennessy C; Zechner J

Review of Financial Studies 2011 August Vol 24:10 p 3369-3400

2010

Acquisition values and optimal financial (in) flexibilty

Hennessy C; Hege U

Review of Financial Studies 2010 March Vol 23:7 p 2865-2899

Repeated signaling and firm dynamics

Hennessy C; Livdan D; Miranda B

Review of Financial Studies 2010 March Vol 23:5 p 1981-2023

2009

Debt, bargaining, and credibility in firm-supplier relationships

Hennessy C A; Livdan D

Journal of Financial Economics 2009 September Vol 93:3 p 382-399

2008

Taxation, agency conflicts, and the choice between callable and convertible bonds

Hennessy C; Tserlukevich Y

Journal of Economic Theory 2008 November Vol 143:1 p 374-404

2007

2005

Debt dynamics

Hennessy C; Whited T

Journal of Finance 2005 Vol 60:3

2004

Tobin's Q, debt overhang and investment

Hennessy C

Journal of Finance 2004 Vol 59:4 p 1717-1742

2017

Subject rational expectations will contaminate randomized controlled medical trials

Chemla G; Hennessy C

CEPR Discussion Paper

The paradox of policy-relevant natural experiments

Hennessy C; Chemla G

CEPR Discussion Paper

2015

Natural experiment policy evaluation: a critique

Hennessy C; Strebulaev I

CEPR Discussion Paper

Secondary market liquidity and security design: theory and evidence from ABS markets

Friewald N; Hennessy C A; Jankowitsch R

Working Paper

2014

Government as borrower of first resort

Chemla G; Hennessy C

Social Sciences Research Network

2011

Security design: signaling versus speculative markets

Chemla G; Hennessy C

CEPR Discussion Paper

Teaching portfolio

Our teaching offering is updated annually. Faculty and programme material are subject to change.

Masters Degrees core courses

A key part of our Masters programmes curriculum.
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Capital Structure

This course will give students a hands-on, operational, quantitative understanding of corporate financial decisions-how to make them and how to implement them. Consistent with the mission of the MFA degree, it is assumed students either have a familiarity with the basic theory, or that they will be able to pick up the basic theory on the go.
PROGRAMMES WITH THIS CORE COURSE

Masters in Financial Analysis

Corporate Finance

From the viewpoint of a senior executive, we look at issues of capital allocation, external financing, risk in the corporation and in financial markets, leverage, strategic options, company valuation, corporate governance and executive compensation.
PROGRAMMES WITH THIS CORE COURSE

LBS Sloan Masters in Leadership and Strategy

Executive MBA Dubai

Corporate Finance and Valuation

Why do companies make the investment and financial decisions they do? Understand the principles of project appraisal and firm valuation, financial structure and pay-out policy, using real-life case studies. Assess the merits of real investments; Compute corporate and project-level costs of capital ;Value corporate targets using discounted cash-flow and multiples-based methods ;Analyse financial structure decisions and credit risk at a quantitative level ;Understand the incentive effects of leverage decisions and the role of information in financial decisions ; Analyse corporate payout policy.
PROGRAMMES WITH THIS CORE COURSE

Masters in Finance Full-time

Masters in Finance Part-time

Managerial Finance

Managerial Finance
PROGRAMMES WITH THIS CORE COURSE

Executive MBA Dubai
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Masters Degrees electives

Optional courses providing a deep dive into specialist areas.
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Distressed Investing

Understand this innovative and influential area of corporate finance and private equity activity globally. Assess best practices in the field with reference to case studies, practical examples and lessons learnt. The course draws from The course draws from the experience of senior investment professionals and distressed fund advisors.
PROGRAMMES WITH THIS ELECTIVE

Executive MBA Dubai

Executive MBA London

EMBA-Global

MBA

Masters in Financial Analysis

Masters in Finance Full-time

Masters in Finance Part-time

LBS Sloan Masters in Leadership and Strategy
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Executive Education

Short programmes offering academic excellence, global focus and exceptional diversity of perspective.
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Corporate Finance Modular Programme
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Christopher Hennessy

Research Awards

Teaching portfolio

Masters Degrees core courses

PROGRAMMES WITH THIS CORE COURSE

PROGRAMMES WITH THIS CORE COURSE

PROGRAMMES WITH THIS CORE COURSE

PROGRAMMES WITH THIS CORE COURSE

Masters Degrees electives

PROGRAMMES WITH THIS ELECTIVE

Executive Education