Harvard Professor Seeks to ‘Humanize’ and ‘Demystify’ Finance
Is it possible to put a human face on the seemingly arcane world of finance? Mihir Desai would argue the answer is “yes.”
Desai, a professor of finance at Harvard Business School, says in a recent CNBC interview that finance has “gotten a really bad rap.” The core ideas behind finance, he says, are essential to the functioning of a modern economy — but those same ideas are widely misunderstood.
“There are aspects of finance that have been demonized,” Desai says. “But if you look at these underlying ideas, they’re fantastic. If you think about value creation, about leverage, they’re really great ideas, and they actually apply to your life in interesting ways.”
Desai appeared on CNBC to discuss his new book, The Wisdom of Finance: Discovering Humanity in the World of Risk and Return, in which Desai leans on the humanities for the material needed to “demystify” and “humanize” key concepts of finance and markets, like risk, insurance, value creation, asset pricing, diversification, mergers, debt and more.
The Wisdom of Finance grew out of a 2015 lecture he presented to MBA students at Harvard to illustrate the moral dimensions of finance. Each chapter of the book demonstrates a key financial concept, illustrated through accessible excerpts from religious tales, poetry, novels, history, art and popular culture.
In Desai’s treatment, Biblical parables, the novels of Jane Austen, and movies like Working Girl, among others, become case studies that explain complex financial decision-making concepts in a clear and accessible way.
“What I want to do in the book is actually make it clear to people that finance ideas are easy, they’re accessible — but also we can humanize it,” he explains. “What I wanted to do was to make finance something not complex; I wanted to make it really easy and totally accessible with stories. And I wanted people in finance to think about what they do in a more humane way.”
See also:
Stephens Inc. Launches “This is Capitalism” Web Series