Barcelona GSE Affiliated Professor Vicente Cuñat and Columbia University Professor María Guadalupe were awarded the Jaime Fernández de Araoz Prize in Corporate Finance in a May 28th ceremony presided over by the Prince of Asturias.
The prize, sponsored by Banco Santander and Universia, was established in 2005 to contribute to the development of corporate finance knowledge from the point of view of both research and practitioners. The selection jury was headed by Juan Rodríguez Inciarte, General Director of Santander, and composed by Alberto Ibánez González, President of Citigroup Spain; Rafael del Pino, President of Ferrovial; Juan Entrecanales, Vice President of Acciona; and other prominent businesspeople.
Professors Cuñat and Guadalupe (second to right and far right, respectively) meet the Prince
Professor Cuñat and Professor Guadalupe were selected for the award based on their co-authored paper, "Globalization and the provision of incentives inside the firm", which shared results of an empirical study of how firms shape their executive pay policies to the various competitive environments in which they operate.
Results of the study indicate that firms facing greater international competition are more likely to pay higher average salaries, link pay to performance, have a higher wage dispersion within the firm, have a higher demand - and reward - for talent, and exhibit more aggressive firing and hiring practices.
Conclusions of the study suggest that the sensitivity of firms to employee performance increases as international competition grows, perhaps resulting from the tendency of firms to offer a higher demand and reward for their effort and ability when international competition is high.
The Prince of Asturias speaks during the award ceremony
Professor Cuñat's principal areas of research are applied theory, corporate finance, contract theory, applied econometrics, and industrial organization. In addition to the Jaime Fernández de Araoz Prize, he was awarded the Young Economist Award from the European Finance Association in 2002 and the Ramon Areces Foundation prize for economic research in 2005.
In 2001 Professor Cuñat earned his PhD at London School of Economics, and since then has been an assistant professor at the UPF Department of Economics and History, one of the Barcelona GSE's founding institutions. He will be teaching in the Msc in Finance and the Msc in Economics of the Barcelona GSE in the fall.
Professor Vicente Cuñat and Professor Maria Guadalupe receiving the award