Tuesday, April 17, 2012 Real Estate News
New Faculty Member Jaime Luque Builds on His Passion for Teaching and Research by Bill Shepherd

Jaime LuqueBack when Jaime Luque was an undergraduate student in his native country of Spain, he discovered he had a passion for the field of economics. And, he discovered a natural talent and passion for teaching, too.

"When I was studying at the University of Salamanca, I taught immigrants to read and write, through a Spanish non-profit organization called 'Caritas'," he explains.

Since then, Luque has traveled far - literally and figuratively - in the world of academe.

As a recent addition to the Wisconsin School of Business' Department of Real Estate, Luque brings a wealth of international educational experience to the table. He will join UW-Madison in September 2012 as an assistant professor of Real Estate and Urban Land Economics, after having taught in the Department of Economics at the Carlos III University of Madrid since 2009.

"Spending three years teaching in a top European economics department provided rich experiences and many beneficial contacts," says Luque, whose research interests include financial economics and urban economics, as well as public and political economy.

Luque's own educational background is decidedly multinational. He earned a Ph.D. in economics from the New University of Lisbon in Portugal, supervised by Mario Páscoa, a bachelor's degree in Economics from the University of Salamanca in Spain. And, as an undergraduate, he studied for one year as a visiting Erasmus Student at the National University of Ireland in Galway.

Of his various research efforts, Luque's recent work on fiscal unions has been particularly relevant to the harsh realities of the Euro zone debt crisis.

"My research has shown that, without a fiscal union, volatility may kill the common currency," Luque says.

Collaborating with Professor Massimo Morelli of Columbia University in New York City and Professor José Tavares of the New University of Lisbon, Luque and his colleagues produced a paper explaining how the voting weights of different countries should be tied to their income, size and correlated income shocks. Through a syndicated op-ed piece summarizing the paper's main points, Luque and company have generated publicity for their work among policymakers and academics alike.

"I also presented this paper at the European Central Bank, and it was of high interest to the bank's researchers," Luque says.

His other research efforts also have "real world" implications as well. Take, for example, his work on repo markets and re-hypothecation, a joint research endeavor he has undertaken with Professor Jean-Marc Bottazzi of the Paris School of Economics in France, and Professor Mário R. Páscoa of the New University of Lisbon.

"The recent financial crisis has revealed to us how difficult it is to control the amount of leveraging that occurs in financial markets," Luque says. "Our research helps financial regulators understand the complexity of repo markets."

Not only that, but their research paper also proposes ways to limit re-hypothecation rates, and in turn, leveraging that occurs in financial markets.

Luque's other research interests include bubbles, Ponzi schemes, currency squeezes, bourse structures and societal stratification. As a member of numerous academic organizations, he has enhanced his reputation in the field by presenting his research papers at international economic conferences on both sides of the Atlantic.

When it comes to teaching his students, Luque brings a high level of enthusiasm and a commitment to excellence to the classroom. He is particularly proud of his efforts to encourage several brilliant students at Carlos III University to pursue post-graduate work, which he counts among his most important achievements as an educator.

"I always teach my students with a great deal of passion," he says. "I make sure that every student understands the economic problems that are formulated. Most importantly, I try to teach them how to think."

Luque, who enjoys reading, tennis, rowing and running in his spare time, is pleased to have joined the UW faculty.

"The UW Real Estate Program is one of the best in the world, and its faculty are committed to make it a universally acclaimed thought leader in the field," Luque says. "I hope to contribute to its success."