Business Economics & Quantitative Finance Research Cluster

The Economics and Finance Research Cluster is home to a very diverse array of research from modelling returns on financial assets to studying migration and labour markets to considering the roles of institutions and entrepreneurship in our economy and wider society. Led by Professor Stephen Drinkwater, the cluster base themselves at Southlands College and enjoy good interdisciplinary links across the university and with other research groups around the world. 

In addition to writing books and presenting their research at international conferences, members of the group also regularly publish top journals such as Economics Letters, Entrepreneurship & Regional Development, European Journal of Finance, International Journal of Financial Analysis, Journal of Financial Services Research, International Small Business Journal, The British Accounting Review and Small Business Economics.

The current research programme of the cluster includes

  • Migration and Labour Markets 
  • Modelling Returns on Financial Assets 
  • International Finance 
  • Fiscal and Monetary Policy
  • Entrepreneurship & family firms 
  • Human Capital and Firm Performance 
  • International Joint Ventures
  • Institutions and Economic Growth
  • Bank-firm relationship, risk disclosure and market discipline


PhD students

  • Sahil Sambyal (Supervisors: Dr. Parhi, Prof. Zarantonello, Dr. Ipatova)

Research Highlights

Micro-economics of the labour market

Professor Drinkwater leads our research into the microeconomics of the labour market. The research covers labour market discrimination, self-employment, industrial relations, international and interregional migration, the effect of language on economic activity and voting behaviour. For example, Professor Drinkwater was part of a team that conducted research into the effect disability has on employment. The analysis indicates that the likelihood of being in work falls by 21% in the first two years following a work-limiting disability, with weekly hours of work falling by a total of 23%. The research was undertaken in collaboration with colleagues from Cardiff University and Wales Institute of Social and Economic Research, Data and Methods. 

How financial markets and depositors react to supervisory actions and to relevant news in the public domain: a focus on market discipline and depositors’ awareness

Dr. Irma Malafronte is an active researcher in accounting and finance. Her research explores the bank-firm relationship, enforcement actions, market discipline and depositors’ awareness. She is working on a research project exploring how financial markets react to supervisory actions and relevant news in the public domain, and how depositors react to enforcement actions in the banking industry. The findings of her recently published research shows that equity market and depositors are able to discriminate enforcement actions based on their severity; demand depositors exhibit some level of depositor disciplining mechanism following cease and desist announcements, while core depositors seem to reward sanctioned banks for a higher return. These findings have important policy implications in the area of banking supervision to guide banks' behaviour and policy interventions and contribute to enhancing supervisory effectiveness.

Campaigning for a referendum on the final Brexit deal

Prof. Scott Cato has campaigned for a People’s Vote on the final Brexit deal and exposed organisations and wealthy individuals behind the Leave campaign and who are now pushing a hard-right agenda. Molly is actively engaged in debates about the nature of our future trading relationship with the EU should Brexit go ahead and have argued strongly for us to remain members of the single market and customs union. She wrote about the importance of the customs union for the Guardian.  She also commissioned reports on potential opportunities for farming and trade in the event of the UK leaving the EU. You can watch her latest speech at the European Parliament on the topic here.

Our recent research-related successes

Molly Scott CatoProfessor of Green Economics is organising aonline discussion The Corona Crisis and the Climate Emergency: Risks and Possibilities’. She will be joined by Dr. Alan WhiteheadLabour MP for Southampton and Test and Shadow Minister for Business Energy and Industrial Strategy. During a Zoom talk they will discuss how the globalised lockdown had an immediate impact on air pollution and carbon emissions, and whether we can we take these improvements into the future. They will also be discussing what the experience of lockdown means for environmental activism and governmental policy on the environment, and what lessons can we learn from this period to ensure a greener, more sustainable future. You can join this event on the 25th of September at 6 pm, please register here 

Prof. Drinkwater will be working with a team of researchers from the University of Swansea and Aberystwyth on an ESRC funded research project with total funding of £6.2 million. This grant has been awarded to WISERD to transform understanding of how civil society is affected by forms of civil exclusion and expansion, civic loss and gain, and the potential for civil society organisations to play a key role in civil repair. Stephen will act as a lead investigator under one of the four key research themes "Polarisation, Austerity and Civic Deficit."

Dr. Malafronte has published a research article titled “Enforcement Actions, Market Movement and Depositors’ Reaction: Evidence from the US Banking System” in the Journal of Financial Services Research (CABS 3). This study investigates market movement and depositors’ reaction following the announcement of enforcement actions on US banks. The full article is available here.

Prof. Drinkwater co-authored a blog post titled 'Are there differences in volunteering in health and social care and responses to the Coronavirus in England and Wales?' in the Wales Institute of Social & Economic Research, Data & Methods. Their analysis provides a greater understanding of how public and third sector organisations can target potential volunteers in the future since it reinforces the importance of demographic factors in explaining differences in behaviour.

Dr. Parhi has published a research article titled 'Giver and the receiver: Understanding spillover effects and predictive power in cross-market Bitcoin prices' in the International Review of Financial Analysis (CABS 3).

Dr. Foresti has published an academic paper on 'Animal Spirits and Fiscal Policy' in the Journal of Economic Behavior & Organization (CABS 3). In collaboration with Dr. Grauwe, they study the effects of government spending with a behavioural macroeconomic model in which agents have limited cognitive capabilities and use simple heuristics to form their expectations. You can read it here.