Risk & Compliance

Chief Economist Spatt to Leave SEC

An expert in "the underpinnings of the securities markets," he will return full-time to Carnegie Mellon at the end of July.
Stephen TaubJuly 20, 2007

Securities and Exchange Commission chief economist Chester Spatt, who also serves as director of the Office of Economic Analysis (OEA), is leaving the agency after three years.

At the end of this month he plans to return to Carnegie Mellon University, where he serves as Mellon Bank professor of finance and director of the Center for Financial Markets at the Tepper School of Business. Spatt’s research and teaching there will focus on economic issues related to securities regulation, and on asset allocation and taxes, the SEC said.

A replacement wasn’t named in the SEC press release.

SEC chairman Christopher Cox pointed out that Spatt actually completed his initial term with the commission while on leave from Carnegie Mellon during 2006, but chose to stay at the SEC for another year.

The SEC credited Spatt with leading the staff’s economic analysis of key issues, including implementation of options expensing through models and markets, mutual-fund market timing and late trading, option-grant and -exercise backdating, executive compensation, Regulation SHO, shareholder voting, credit-rating agencies, nationally recognized statistical-rating organizations, foreign private-issuer deregistration, and the economics of penalties and sanctions. He also fostered stronger ties between the SEC and the academic community, encouraging greater participation from academic experts in the rulemaking process, according to the commission.

“His exceptional background, expertise, and judgment concerning the economic underpinnings of our securities markets have been invaluable resources to the commission,” said Cox.

Spatt has held academic positions at Carnegie Mellon since 1979, along with visiting professorships at Toulouse University, the University of British Columbia, and Princeton University. He was one of the founders of the prestigious Review of Financial Studies, and served as executive editor. He is also a past president of both the Western Finance Association and the Society for Financial Studies.

According to Carnegie Mellon, Spatt’s teaching and research interests include taxation and asset pricing, with an emphasis on how taxation of capital gains and losses has an impact on investor behavior and the pricing of securities; securities-market regulation; pricing and hedging of fixed-income securities, with an emphasis on mortgage contracting and valuation; equilibrium models of forward curves for commodities; market microstructure, including the effect of information and strategic behavior on market processes; the interaction between the order flow and order book in security markets; and the effect of the preopening on pricing.