Charles M. Kahn

Charles M. Kahn is the Bailey Memorial Professor and chair of the Department of Finance at the University of Illinois. An authority on payments systems, banking and financial intermediation, he has done research on a variety of topics in finance and economics, with contributions in labor economics, macroeconomics, the economics of information and uncertainty, and auction theory. He is a regular consultant at central banks throughout the world and will be a visitor this year at the Federal Reserve Banks of New York, Chicago, and Atlanta.

After studying at Cambridge University, Professor Kahn received his Ph.D. from Harvard University in 1981. He has taught at the University of Chicago, and been an overseas fellow at Cambridge University, a visiting fellow at the Australian National University, and the Tan Chin Tuan Professor at the National University of Singapore. Last year Professor Kahn was a Houblon-Norman fellow at the Bank of England, where he researched and wrote on payment systems and liquidity.

Among his important publications are "The Solution of Linear Difference Models under Rational Expectations," (with Olivier Blanchard, Econometrica, 1980), "The Role of Demandable Debt in Structuring Optimal Banking Arrangements," (with Charles Calomiris, American Economic Review, 1991), "The Economic Role of Foreclosures," (with Abdullah Yavas, Journal of Real Estate Finance and Economics, 1994), and "Why Pay: An Introduction to Payments Economics" (with William Roberds, Journal of Financial Intermediation, 2009).

Recently, in a series of papers in collaboration with William Roberds, Joao Santos, and James MacAndrews of the Federal Reserve, Kahn has developed a series of theoretical models of the microeconomics of payments mechanisms and used these models to examine the effects of institutional arrangements on the economic stability and efficiency of payments, both at the wholesale level (large value transfers between major financial institutions) and the retail level (consumer credit cards, cheques, electronic moneys). Some of his latest work has examined the effects of privacy and of identity theft on retail payments systems.