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Business in an Interconnected World

Kogod School of Business professor of finance and real estate Ioannis Spyridopoulos highlights the vital role of networks in business.

Ioannis Spyridopolous Hero

Kogod School of Business professor of finance and real estate Ioannis Spyridopoulos.


For entrepreneurs and growing businesses alike, financial literacy and access is the key to getting off the ground. A deep understanding of why businesses make their decisions gives competitors an edge in developing their work and helps people from all sectors grasp the broader implications of those decisions. Kogod professor of finance and real estate Ioannis Spyridopoulos has centered his research around capital markets and interconnectedness across firms in hopes of furthering his understanding of these topics and passing that same understanding on to his students.

“One of Kogod’s featured themes is the idea of business as a force for meaningful change, and I truly believe in the value that businesses create,” he said. “It’s why I love doing research in business and finance and why I’m so passionate about teaching financial theory and methods to our students.”

Professor Spyridopoulos’ commitment to the field is reflected in his achievements. His publication “The Epidemiology of Financial Constraints,” coauthored with William Grieser and Morad Zekhnini, recently won the Southern Finance Association’s Best Paper Award and has gained additional traction across several other national conferences. The paper explores the theme of networking across businesses and industries and the impact of co-investing within partnerships.

We live in a highly interconnected world—otherwise, how can shortages in one industry be responsible for affecting production across a wide range of products?”


Ioannis Spyridopoulos

Professor of Finance and Real Estate, Kogod School of Business

“The study poses that supply chain partners coordinate their investments, so when one firm in the chain cannot invest, there are far-reaching implications to that underinvestment,” Spyridopoulos explained.

In short, firms in a partnership use their partners’ decisions to inform their own, and one partner opting not to invest can lead to a ripple effect across an entire industry. This was perhaps seen most drastically in 2008 when investment bank Lehman Brothers’ bankruptcy triggered a significant economic downturn with domestic and global consequences. Though Lehman Brothers was just one firm in the larger US economy, its place in a broader network meant that its collapse sent a shockwave through that network.

Not only do these partnerships lead to widespread investment decisions and consequences, but also to information systems. Professor Spyridopoulos also published a paper titled “Agglomeration, Knowledge Spillovers, and Corporate Investment” in the Journal of Corporate Finance. This paper, coauthored with Grieser, Gonzalo Maturana, and Santiago Truffa, explores why large firms often locate near each other geographically and how that impacts their ability to directly and indirectly learn from each other. Though the paper was initially planned as a theoretical exploration, Spyridopoulos and his team ultimately turned it into an empirical study despite its challenges.

“We were able to overcome challenges by investing effort and time into learning and adopting techniques from spatial econometrics and network analysis,” he explained. “Incorporating networks in research imposes technical challenges, but it also significantly expands the importance of a study’s contribution.”

Spyridopoulos highlighted two major takeaways from this paper. The research was motivated by the observation that firms often cluster together in large urban areas, allowing knowledge to spread easily. Proximity enables firms to coordinate their decisions with others in their industry and observe decisions and trends among their neighbors, providing them with additional context to make better choices for themselves. Additionally, the work highlighted the value of peer influence and the ability to connect with others when establishing a career.

Peer influence can help both businesses and students improve the way they select their projects—where to invest and how to do it. If a student wants to work in a real estate or technology sector, being in the right place can be extremely helpful.”


Ioannis Spyridopoulos

Professor of Finance and Real Estate, Kogod School of Business

Professor Spyridopoulos knows that this type of research can feel impersonal from an outsider’s point of view, so he aims to demonstrate that the value of networks is just as important at the individual level. “The impact a single person can have in the larger world may be small if we only consider the direct effect,” he said. “But the indirect impact of our actions through the networks of people we interact with—our family, friends, social and work connections—significantly amplifies that impact. Our actions influence the behaviors of those around us, and thus our actions are not trivial.” Just as businesses impact each other due to the networks they’ve established, individual choices can add up to create meaningful change. In Spyridopoulos’s experience, the promise of making a difference through these network effects makes the work he does so rewarding.

Moving forward, Spyridopoulos hopes to continue exploring the implications of financial access on the welfare of both businesses and society. Now that he’s documented the impact of location on firms, he wants to investigate how the COVID-19 pandemic affected location and whether the combination of remote work and technological progress will cause proximity to become less critical in the years to come.

He is also interested in answering questions about the social impact of finance, both at a firm and an individual level. “Some of my research documents whether the changing landscape in market dynamics, such as banks gaining more power after mergers, has a meaningful effect on lending practices on minority and low-income borrowers,” he explained. “I’d also like to examine the social consequences of financial access. I have a recent working paper documenting that individuals who experience a foreclosure are twice as likely to get divorced in the two years after the event takes place.”

Topics in financial access reach far and wide, and Spyridopoulos wants to use his work to help businesses and people better understand the finance world and the implications of their choices.

As for his professorial work, Spyridopoulos wants to leave his students with a better understanding of why finance matters. “Finance—and maybe business in general—can get this demonized view where people think it’s all about speculation and a quick profit, but there’s so much more to it,” he said. “Financial access is the fuel business needs to grow and succeed. It allows an entrepreneur to use their ideas, passion, and grit to create value that ultimately benefits everyone. That’s the message I try to convey to Kogod students when teaching our core finance course.” Professor Spyridopoulos highlights Kogod’s mission of promoting business as a force for good by teaching his students how finance is critical among networks and at the individual level.