Faculty profile: Jingxuan Zhang

Jingxuan joins the Alberta School of Business as a tenure-track assistant professor in the Department of Finance. He recently earned a PhD in Finance from the Carroll School of Management at Boston College. He also holds a MPhil degree in Finance and Economics from the University of Cambridge and double BSc degrees in Economics and Finance from the Southwestern University of Finance and Economics (China) and the University of Birmingham (UK). His research interests are mainly in corporate innovation, entrepreneurial finance, venture capital and initial public offerings (IPOs).

How did you first become interested in pursuing finance and economics? What drew you to this area?

I was first drawn to the field of economics when I took an “ECON 101” course in my freshman year. In that course, we used the textbook Principles of Economics by Gregory Mankiw, and I still remember the opening sentence of that book as well as one of the 10 principles of economics described by the author. Mankiw started this book by defining economics as the study of “how society manages its scarce resources”. In addition, when I first ran into the 10 principles of economics in this textbook, one caught my eye immediately: people respond to incentives. The definition of the subject itself and this principle are succinct, yet so powerful, that it describes the very truth of how different agents in society behave and react. Thereafter, I was fascinated by the notion that economics is trying to model and understand the real world, and I just love such an applied subject.

My interest in pursuing a career in academia started with my journey at the University of Cambridge, where I was involved in a research project led by Professor Raghu Rau at the Judge Business School of the University of Cambridge. This project, which later turned into a publication in the Critical Finance Review, studies different routes for a firm to go public. Traditional wisdom would assume that a firm taps the public market by offering its equity to outside investors for the first time (i.e., an Initial Public Offering, or IPO, of its equity). However, we notice in the data that there are a certain number of firms that choose to issue public debt first before offering public equity for the first time, and we wanted to explore what factors are associated with firms’ different choices for going public.

This project ignites my passion for academic research since it allows me to wield the power of data and empirical methodology to answer interesting real-world problems.

In addition, this project has exposed me substantially to an intriguing research area (i.e., IPOs), which later becomes one of my research focuses and leads to me working with my advisor, Prof. Thomas Chemmanur, at Boston College, since we share abundant common research interests.

Tell us a bit more about your current research interests.

My current research agenda largely falls into the territory of empirical corporate finance, with a special focus on corporate innovation, entrepreneurial finance, venture capital, and initial public offerings.

In terms of corporate innovation, I study what kind of factors are contributing to a firm’s innovation success and, naturally, how a firm manages its innovation output once they are developed. In my solo-authored working paper (which is also my job market paper), I study why certain firms choose to sell their innovation output (specifically, patents) to others and the consequences of such transactions. The notion of one firm selling its patents seems to be counter-intuitive at first because once a firm puts plenty of resources into its internal innovation, the firm can just keep its innovation output on the shelf if it feels like not using them at the moment, let alone selling them to others. However, what I observe in the data is that there is an increasing number of firms participating in the secondary market of patents and selling their patents in this market. I also feel that this topic is important not only for firms themselves, but also for the whole economy, as having a well-functioning secondary market for patents could curtail duplicate R&D efforts, facilitate knowledge spillovers and exchanges, and ultimately improve social welfare.

In the second stream of my research agenda, I focus on the area of entrepreneurial financing, which studies how entrepreneurial firms (i.e., firms at a very early stage in their life cycle) obtain external financing and the implications of different financing approaches for firms’ future growth. As one may know, the lack of financing is oftentimes the biggest problem for young firms. Without sufficient capital boost, a firm with good business ideas or plans may never get the chance to execute them. In this research agenda, I am particularly fascinated by venture capital, one of the most important financing intermediaries for entrepreneurial firms around the globe. I am very interested in using special data sources to study how venture capitalists select certain types of firms to invest in and how they add value to the firms’ subsequent growth and expansion.

What made you want to join the Alberta School of Business? What excites you most about working here?

I am very excited about the opportunity to join the Department of Finance at the Alberta School of Business. When I first visited the school during my campus interview, I just got the vibe that it would be the perfect place for me to conduct my research: my colleagues are super helpful and easy to get along with from day one; I have many colleagues with whom I share similar research interests, which could lead to many exciting co-authored projects in the future; last but not least, the Department of Finance and the Alberta School of Business provide me with abundant resources to support my research and teaching, and they are also constantly making an incredible effort to promote a research-oriented environment where both intra-and cross-departments interdisciplinary collaborations are genuinely encouraged. This is immensely important for me since a large part of my research agenda spans not only finance but also accounting, strategy and entrepreneurship.

What can your students at the U of A expect from you as a teacher? What is your teaching style or philosophy?

I consider teaching to be an integral and also critical part of academic life contributing to my growth as a researcher. I believe that the ultimate goal of teaching a class is to help foster the academic curiosity of students and promote their enthusiasm for the subject, such that when students finish the class I am teaching, they have learned something valuable and beneficial to deepen their understanding of the real world. To stimulate students’ interest in class, I will emphasize applying financial concepts and theories to real-world examples so that the whole learning experience can be more practical and entertaining. I will select news articles and recent case studies for class discussion, and keep course content up-to-date based on my academic research and the latest trends in the financial industry.

I believe that, as the professor leading a class, the role I should play in achieving the above aforementioned goal is to be an approachable and supportive professor, who is willing to build personal relationships with students and is willing to go the extra mile to help students.

I want to establish a warm and supportive environment to encourage students to ask questions and seek help from me. I will try to understand different students' needs at the beginning of the class and adjust my teaching style accordingly. I will remain accessible both inside and outside the classroom by offering extra office hours if needed and responding to students’ questions through emails. I will also support students’ ideas and projects and provide them with guidance, feedback and encouragement.

You've lived all over the world – China, England, the U.S. and now Canada. What do you most look forward to about living in Edmonton? What has been the biggest adjustment so far?

There are plenty of things to look forward to when I embark on my next journey in Edmonton. I look forward to the astonishing natural scenery that Edmonton and its surrounding areas have to offer: I would love to take a walk constantly down the River Valley; I would love to visit the nearby national parks such as Banff and Jasper from time to time; and I am certainly looking forward to all kinds of winter activities in Edmonton.

So far the transition from Boston to Edmonton has been very smooth with all the help I could get from the department, but I guess the biggest adjustment forthcoming is the cold weather during the winter. Growing up in the southern part of China, I did not really get the chance to experience such cold weather like the one in Edmonton. Luckily, I already spent five years in Boston and gradually got used to the weather during winter, so I hope the adjustment to the winter here in Edmonton would not be too challenging (plus there will be many fun things to do in Edmonton!)

What’s one thing people would be surprised to learn about you?

I am a music enthusiast. I enjoy listening to all kinds of music day to day (I am a Coldplay fan 😊), and I also play several instruments: I grew up playing violin, and I have also been self-teaching guitar and piano. For me, playing different instruments is a great way to relax, and it also helps me to change the pace from all the research and teaching activities.