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Dublin: 7 °C Thursday 14 November, 2019

Column: Mathematics is a potential tonic for our ailing economy – but remains overlooked

IFSC-based firms are being forced to recruit overseas for researchers with PhDs in mathematics, physics and other technical subjects as a direct consequence of the lack of a clear strategy on maths, writes Eoin Ó Colgáin.

Eoin Ó Colgáin

CHANCES ARE YOU haven’t heard of Jim Simons. If I tell you that Jim is the Simons of “Chern-Simons” theory, making him a living legend for mathematicians and physicists alike, the name may not be expected to ring a bell with the general public. Now, what if I tell you that Simons is also ex-CEO of Renaissance Technologies and #82 on the Forbes Rich List; perhaps it strikes a different note?

Renaissance Technologies, the brainchild of Simons, is a secretive hedge fund specialising in automated trading and hidden away on Long Island, New York. It is famous for averaging 35 per cent annual returns over many years, making Jim and his employees unimaginably wealthy and the envy of Wall Street.

Interestingly, Renaissance prioritises employees with mathematics and physics PhDs – over finance MBAs – leading to it being labelled “the best physics and mathematics department in the world”.

The power of mathematics

While mathematicians largely study mathematics for its own sake and sense of beauty, Renaissance is a striking example of the powerful impact of mathematics. Even if we neglect countless other prominent examples, confined simply to finance, the mathematical models employed by automated traders benefit markets by reducing volatility and supporting recoveries.

Given the far-reaching impact of mathematics, it should not be too surprising that the Engineering and Physical Sciences Research Council (EPSRC) funding body commissioned Deloitte in 2012 to author an exhaustive report into the economic benefits of mathematical science research in the United Kingdom.

In contrast, across the channel, Ireland’s own National Research Prioritisation Exercise (NRPE) conducted by a panel of civil servants, scientists and industry heads, and commissioned by Minister Richard Bruton, largely drew a blank on mathematics. This is incredible given the obvious strategic importance of the International Financial Services Centre (IFSC) to the economy.

Or to put it in concrete terms, a recent Accenture report states that the IFSC employs 32,700 people (10,000 in Irish owned or managed firms), returns €2.1 billion to the Exchequer in taxes and represents approximately 7.4 per cent of the Irish GDP. More importantly, mathematics with a view to finance meets all four high-level criteria for assessment of priority areas.

Firms are forced to recruit overseas

In the bigger picture, it is not rocket science that fewer mathematics principal investigators (PIs) means fewer PhDs and the knock-on effect is that companies looking locally for independent researchers with strong analytic skills will be disadvantaged.

A case in point is Susquehanna International Group, an IFSC-based firm trading securities and derivatives. As with Renaissance, SIG’s desired researchers typically possess PhDs in mathematics, physics and other technical subjects. But, as a direct consequence of the lack of a clear strategy on mathematics, SIG have identified a shortage of suitable local PhD candidates – forcing them to recruit overseas.

SIG is by no means an exception, and it is safe to assume that other high-profile job creation announcements by the current government will be slow to fill.

We could have a national mathematics centre based at the IFSC

Building on the success of projects currently funded by Science Foundation Ireland (SFI), notably the FMC2 group, prioritisation of mathematics research, in addition to helping fill much-needed job vacancies, could, with a little imagination, pave the way to a national mathematics centre based at the IFSC and supporting a community of trained mathematicians solving pure, applied (physical, industrial) and financial problems with strategic value to Ireland’s long-term competitiveness and development.

The proximity to industry partners would seed natural partnerships and this exercise would be a marked improvement on the current situation where mathematicians have been largely locked out of SFI funding.

Finally, a concrete focus on mathematics would underline the widely recognised importance of the subject to society and align nicely with efforts to promote mathematics through bonus points and Project Maths.

At the end of the day, a home-grown Jim Simons could be an unexpected windfall of prioritising maths.

Eoin Ó Colgáin is a member of the Irish diaspora working on theoretical physics. He has a EU Marie Curie Fellowship with SUNY Stony Brook, where Jim Simons bankrolls the Simons Center for Geometry and Physics, complete with French chef!

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Eoin Ó Colgáin

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