In honor of the Nobel laureates Robert C. Merton and Myron S. Scholes: a partial differential equation that changed the world
Article Abstract:
Most economists underestimate the impact of the method to determine the value of derivatives developed by Robert C. Merton, Myron S. Scholes and the late Fischer Black. This model, widely known as the Black-Merton-Scholes model, presents a pricing argument which has played a key role in the development of derivative markets. The Black-Merton-Scholes option pricing technology formed a new field within finance in the area of asset pricing or investments identified as derivatives. Furthermore, the Black-Merton-Scholes option pricing perspective has had a significant impact on corporate finance.
Publication Name: Journal of Economic Perspectives
Subject: Economics
ISSN: 0895-3309
Year: 1999
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A portfolio of Nobel laureates: Markowitz, Miller and Sharpe
Article Abstract:
The 1990 Nobel Prize in economic Science was awarded to Harry Markowitz, Merton Miller and William Sharpe for their contributions in the field of portfolio management. Markowitz pioneered portfolio optimization through the concept of measuring the riskiness of stock through its variance and covariance. Sharpe simplified the formulation for Tobin's model for a riskless asset. Miller, together with Franco Modigliani, revolutionized corporate finance management by showing that there is no relation between financial structure and firm value.
Publication Name: Journal of Economic Perspectives
Subject: Economics
ISSN: 0895-3309
Year: 1993
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In honor of Kevin M. Murphy: Winner of the John Bates Clark Medal
Article Abstract:
An appreciation of American economist Kevin M. Murphy is presented in recognition of his award of the John Bates Clark medal in 1998. His background, characteristics and contributions to economic theory are discussed.
Publication Name: Journal of Economic Perspectives
Subject: Economics
ISSN: 0895-3309
Year: 2000
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