TIAA Institute head says award-winning paper suggests “truly impactful solutions.”
Assistant Professor Peter Ganong

Two University of Chicago faculty members – Peter Ganong, assistant professor at the Harris School of Public Policy, and Pascal Noel, Neubauer Family Assistant Professor of Finance at the Booth School of Business – have been awarded the 26th annual TIAA Paul A. Samuelson Award for Outstanding Scholarly Writing on Lifelong Financial Security. Bestowed by the TIAA Institute, the Samuelson Award recognizes outstanding research that can enhance Americans’ financial well-being.

Record foreclosure rates and reduced aggregate demand during the Great Recession sparked a vigorous policy debate about decreasing defaults and increasing the consumption of struggling borrowers. The award-winning report, “Liquidity Versus Wealth in Household Debt Obligations: Evidence from Housing Policy in the Great Recession,” finds liquidity drives borrowers’ default and consumption decisions, which suggests that distressed debt restructurings can be redesigned with substantial gains to borrowers, lenders, and taxpayers.

“This research has the potential to change how we look at borrowing and consumption during major economic downturns,” said David P. Richardson, head of the TIAA Institute. “The authors not only outline the important role of liquidity but also suggest truly impactful solutions.”

“By making temporary payment reduction broadly accessible during the COVID-19 pandemic, policymakers prevented a wave of foreclosures, similar to the one experienced during the Great Recession,” said Ganong, who studies income volatility and policies to mitigate its consequences.  

“Falling behind on mortgage payments during the Great Recession was devastating for many families, leading one out of every 13 owner-occupied homes to undergo foreclosure when all many needed to catch up was a temporary payment reduction,” added Noel.

In addition to ongoing work examining mortgage default, Ganong has studied how households respond to unemployment insurance (UI) benefit exhaustion throughout the pandemic.  He worked at the White House Council of Economic Advisers from 2009 to 2010, helped to start the City of Boston's Citywide Analytics Team from 2014 to 2015, and helped start

According to Stephen P. Zeldes, Benjamin M. Rosen Professor of Economics and Finance at Columbia University's Graduate School of Business and one of the Samuelson Award judges, “In this creative, beautifully executed, and policy-relevant paper, the authors address an important and longstanding question in economics: how much does short-term liquidity influence consumer behavior? Using new comprehensive data, they come up with a clear answer: liquidity matters, both for consumer spending and mortgage default.”

Learn more about the TIAA Paul A. Samuelson Award.