Shawn A. Cole

Associate Professor of Business Administration

Shawn Cole is an associate professor in the Finance Unit at Harvard Business School, where he teaches a second-year elective course “Business at the Base of the Pyramid.”

His research examines corporate and household finance in emerging markets, with a focus on banking, microfinance, insurance, and the relationship between financial development and economic growth. He has worked in China, India, Indonesia, South Africa, and Vietnam. He is an affiliate of the National Bureau of Economic Research, MIT’s Jameel Poverty Action Lab, and the Bureau for Research and Economic Analysis of Development.

He has taught FIN1 and FIN2 in the core curriculum, as well various executive education courses, and currently teaches a portion of the PhD-level development class in the department of Economics.

Before joining the Harvard Business School, Professor Cole worked at the Federal Reserve Bank of New York in the economic research department. He currently serves on the Boston Federal Reserve's Community Development Research Advisory Council, and has served as an external advisor to the Gates Foundation, and as the chair of the endowment management committee of the Telluride Association, a non-profit educational organization.

He received a Ph.D. in economics from the Massachusetts Institute of Technology in 2005, where he was an NSF and Javits Fellow, and an A.B. in Economics and German Literature from Cornell University.


  1. The Value of Advice: Evidence from Mobile-Phone Based Agricultural Extension

    This paper evaluates the role of mobile phone-based advice in improving managerial practices of small-scale cotton farmers in Gujarat, India.  Demand for the service, “Avaaj Otalo,” is strong, even among farmers with very low levels of education. The service dramatically alters farmers information acquisition behavior, with connected farmers relying less on other farmers and agricultural input dealers. Management practices improve: we observe an increase in the adoption of more effective and less toxic pesticides, and farmers plant cumin, a profitable but risky crop, earlier in the season. Farmers appear willing to follow advice without understanding why the advice is correct: the average respondent does not demonstrate improved agricultural knowledge

  2. Do Voters Demand Responsive Governments? Evidence from Indian Disaster Relief

    Using rainfall, public relief, and election data from India, we examine how governments respond to adverse shocks and how voters react to these responses. The data show that voters punish the incumbent party for weather events beyond its control. However, fewer voters punish the ruling party when its government responds vigorously to the crisis, indicating that voters reward the government for responding to disasters. We also find evidence suggesting that voters only respond to rainfall and government relief efforts during the year immediately preceding the election. In accordance with these electoral incentives, governments appear to be more generous with disaster relief in election years.  These results describe how failures in electoral accountability can lead to suboptimal policy outcomes.

  3. Incentivizing Calculated Risk-Taking: Evidence from an Experiment with Commercial Bank Loan Officers

    This paper uses a series of experiments with commercial bank loan officers to test the effect of performance incentives on risk-assessment and lending decisions. We first show that, while high-powered incentives lead to greater screening effort and more profitable lending, their power is muted by both deferred compensation and the limited liability typically enjoyed by credit officers. Second, we present direct evidence that incentive contracts distort judgment and beliefs, even among trained professionals with many years of experience. Loans evaluated under more permissive incentive schemes are rated significantly less risky than the same loans evaluated under pay-for-performance.