Robert C. Merton

About

Biography

Robert C. Merton is the School of Management Distinguished Professor of Finance at Massachusetts Institute of Technology, and the John and Natty McArthur University Professor Emeritus at Harvard University. He was the George Fisher Baker Professor of Business Administration (1988–98) and the John and Natty McArthur University Professor (1998–2010) at Harvard Business School. After receiving a Ph.D. in Economics from MIT in 1970, Merton served on the finance faculty of MIT’s Sloan School of Management until 1988, at which time he was J.C. Penney Professor of Management.

He is currently Resident Scientist at Dimensional Fund Advisors, where he is the creator of Target Retirement Solution, a global integrated retirement-funding solution system.

Merton received the Alfred Nobel Memorial Prize in Economic Sciences in 1997 for a new method to determine the value of derivatives. He is past president of the American Finance Association, a member of the National Academy of Sciences, and a Fellow of the American Academy of Arts and Sciences.

Merton is the author of Continuous-Time Finance and a co-author of Cases in Financial Engineering: Applied Studies of Financial Innovation; The Global Financial System: A Functional Perspective; Finance; and Financial Economics. He has also been recognized for translating finance science into practice. Merton received the inaugural Financial Engineer of the Year Award from the International Association for Quantitative Finance (formerly International Association of Financial Engineers), which also elected him a Senior Fellow. He received the 2011 CME Group Melamed-Arditti Innovation Award, and the 2013 WFE Award for Excellence from World Federation of Exchanges. A Distinguished Fellow of the Institute for Quantitative Research in Finance (‘Q Group’) and a Fellow of the Financial Management Association, Merton received the Nicholas Molodovsky Award from the CFA Institute.  He is a member of the Halls of Fame of the Fixed Income Analyst Society, Risk, and Derivative Strategy magazines. Merton received Risk’s Lifetime Achievement Award for contributions to the field of risk management and the 2014 Lifetime Achievement Award from the Financial Intermediation Research Society.

Merton’s research focuses on finance theory, including lifecycle and retirement finance, optimal portfolio selection, capital asset pricing, pricing of derivative securities, credit risk, loan guarantees, financial innovation, the dynamics of institutional change, and improving the methods of measuring and managing macro-financial systemic risk.

Merton received a B.S. in Engineering Mathematics from Columbia University, a M.S.in Applied Mathematics from California Institute of Technology, a Ph.D. in Economics from Massachusetts Institute of Technology and honorary degrees from sixteen universities.

Curriculum Vitae

  • B.S., Columbia University (Engineering Mathematics), 1966
  • M.S., California Institute of Technology (Applied Mathematics), 1967
  • Ph.D., Massachusetts Institute of Technology (Economics), 1970

  • Masters of Arts, Harvard University, 1989
  • Doctor of Laws, University of Chicago, 1991
  • Professeur Honoris Causa, Hautes Etudes Commerciales (France), 1995
  • Doctor of Economic Science, Honoris Causa, University of Lausanne, 1996
  • Doctoris Honoris Causa, University Paris-Dauphine, 1997
  • Doctor of Management Science (honoris causa), National Sun Yat-sen University, 1998
  • Doctor of Science, Honoris Causa, Athens University of Economics and Business, 2003
  • Doctor Honoris Causa , Universidad Nacional Mayor de San Marcos, Lima, Peru, 2004
  • Doctor of Philosophy, Honoris Causa, Universidad Nacional Federico Villarreal, Lima, Peru, 2004
  • Doctor of Science, Honoris Causa, Claremont Graduate University, 2008
  • Honored Professor, Saint-Petersburg University of Management and Economics, St. Petersburg, Russia, 2011
  • Doctor Honoris Causa, Universidad Catolica de Chile, Santiago, 2014
  • Doctor of Science, Honoris Causa, Chinese University of Hong Kong, 2014
  • Doctor of Business Administration, Honoris Causa, University of Macau, 2014
  • Doctor Honoris Causa, Instituto Politécnico Nacional, Mexico, 2016
  • Doctor Honoris Causa, Universidad Michoacana de San Nicolás de Hidalgo, Morelia, Mexico, 2017
  • Honorary Professor, University of Electronic Science and Technology of China, Chengdu, China, 2017
  • Honorary Professor, Sichuan University, Chengdu China, 2017
  • Honorary Fellowship, Ca’ Foscari University of Venice, Venice 2018
  • Honorary Professor, University of International Business and Economics, Beijing, 2019

  • School of Management Distinguished Professor of Finance, A.P. Sloan School of Management, Massachusetts Institute of Technology, 2010-
  • John and Natty McArthur University Professor Emeritus, Harvard University, 2010-
  • John and Natty McArthur University Professor, Graduate School of Business Administration, Harvard University,1998-2010
  • George Fisher Baker Professor of Business Administration, Graduate School of Business Administration, Harvard University, 1988-1998
  • Invited Professor of Finance, Faculte des Sciences Economiques, Universite de Nantes, 1993
  • Visiting Professor of Finance, Graduate School of Business Administration, Harvard University, 1987-1988
  • J.C. Penney Professor of Management, A.P. Sloan School of Management, Massachusetts Institute of Technology,1980-1988
  • Assistant Professor of Finance, 1970-73, Associate Professor, 1973-74; Professor 1974-80, A.P. Sloan School of Management, Massachusetts Institute of Technology
  • Research Associate, National Bureau of Economic Research ,1979-
  • Instructor, Department of Economics, Massachusetts Institute of Technology, 1969-1970
  • Research Assistant to Paul Samuelson, Massachusetts Institute of Technology, 1968-1970

Current

  • Member, Council of Scholars, Center for Retirement Initiatives at Georgetown University, 2015-
  • Resident Scientist, Dimensional Fund Advisors  2009-
  • Chairman, Board of Directors, Daedalus Software, Inc.  2001-
  • Honorary Chairman, Institute of Global Economics, Seoul, Korea 2018-
  • Co-chairman, Advisory Board, Peking University National Financial Research Center, 2014-
  • Member, Council of the Asian Bureau of Finance and Economic Research (ABFER), 2013-
  • Member, Advisory Board, Institute of Global Finance, Australian School of Business, The University of New South Wales, Sydney, Australia, 2011-
  • Member Quantitative Finance Advisory Board, Department of Applied Mathematics and Statistics, Stony Brook University  2009-
  • Member, Board of Advisors, Santa Clara University Center for Innovation in Finance & Investment  2008-
  • Member, Board of Policy Advisers, Chinese Academy of Sciences Research Center on Fictitious Economy & Data Science  2008-
  • Member, Academic Advisory Board, Real Options Group  1999-

Past:

  • Co-Editor, Annual Review of Financial Economics, 2009-2021
  • Member, Board of Directors, Vical Inc.  2002-2019
  • Member, Competitive Markets Advisory Council, CME Group  2004-2018
  • Member, Panmure House Advisory Board, Edinburgh Business School, Heriot-Watt University, 2012-2014
  • Member, Advisory Board, Office of Financial Research, US Treasury, 2011-2014
  • Member, International Advisory Board, Middle East Science Fund, Amman, Jordan 2008-2013
  • Member, The Committee on Yen Risk-free-rate Model Estimation, 2011
  • Member, MIT Sloan Finance Group Advisory Board  2008-2010
  • Member, Board of Directors, Peninsula Banking Group  2003-2010
  • Member, Board of Directors, Community First Financial Group  2003-2010
  • Member, Board of Directors, Dimensional Funds  2003-2009
  • Member, Board of Directors, MF Risk, Inc.  2001-2009
  • Senior Advisor, Platinum Grove Asset Management 2008
  • Chief Science Officer, Trinsum Group  2007-2008
  • Member, Board of Directors, Trinsum Group  2007-2008
  • Member, Board of Directors, Integrated Finance Limited   2002-2007
  • Co-Founder, Chief Science Officer, Integrated Finance Limited  2002-2007
  • Member, Advisory Board, AlphaSimplex Group, Cambridge, MA  2001-2007
  • Member, Advisory Board, nuServe  2001- 2004
  • Managing Director, J.P. Morgan Chase  2001
  • Member, Advisory Board, eCredit.com  2000-2002
  • Senior Advisor, J.P. Morgan & Company, Inc.  1999-2000
  • Co-Founder, Management Committee, Long-Term Capital Management, L.P.   1993-1999
  • Senior Advisor, Salomon Inc.  1988-1992
  • Member, Board of Trustees, College Retirement Equities Fund  1988-1996
  • Member, Board of Directors, Travelers Investment Management Company  1987-1991
  • Member, Board of Directors, ABT Investment Series  1983-1988
  • Member, Board of Directors, ABT Utility Income Fund  1982-1988
  • Member, Board of Trustees, ABT Growth and Income Trust  1982-1988
  • Member, Board of Directors, Nova Fund  1980-1988
  • Senior Fellow, International Association of Financial Engineers, 1994-
  • Distinguished Fellow, Institute for Quantitative Research in Finance (‘Q Group’), 1997-
  • Honorary Member, the Bachelier Finance Society, 1997-
  • Member, The Honorable Order of Kentucky Colonels, Commonwealth of Kentucky, 1999-
  • FMA Fellow, Financial Management Association, 2000-
  • Fellow, Society of Fellows, American Finance Association, 2000-
  • Member, Honorary Board, The International Raoul Wallenberg Foundation, 2003-
  • Member, Honorary Board, Angelo Roncalli International Committee, 2003-
  • Member, American Association for Cancer Research, 2014-
  • Distinguished Fellow, Center for Financial Studies, Goethe University, Frankfurt, 2014
  • Fellow, Center for Financial Stability, New York, 2018

  • Member, Tau Beta Pi, Columbia University, 1965
  • Member, Sigma Xi, Massachusetts Institute of Technology, 1970
  • Director, American Finance Association, 1982-84; 1987-88
  • Fellow, Econometric Society, 1983-
  • Fellow, American Academy of Arts and Sciences, 1986-
  • President, American Finance Association, 1986
  • Vice President, The Society for Financial Studies, 1993
  • Member, National Academy of Sciences, 1993-

Current:

  • Co-editor, Annual Review of Financial Economics, 2007-
  • Advisory Editor, Review of Development Finance, 2009-
  • Advisory Board, Journal of Applied Corporate Finance, 2008-
  • Advisory Board, Journal of Financial Literature, 2004-
  • Advisory Board, Annals of Finance, 2004-
  • Advisory Board, Journal of Investment Management, 2002-
  • Advisory Board, North Holland Series of Handbooks in Finance, 2000-
  • Advisory Board, International Journal of Theoretical & Applied Finance, 1997-
  • Advisory Board, Brookings-Wharton, 1997-
  • Advisory Board, Journal of Financial Education, 1995-
  • International Board of Scientific Advisers, Tinbergen Institute, 1995-
  • Advisory Board, Review of Derivatives Research, 1993-
  • Advisory Board, Japan Financial Economics Association, 1993-
  • Associate Editor, Journal of Fixed Income, 1991-
  • Advisory Board, Mathematical Finance, 1989-
  • Editorial Board, Finance India, 1988-

Past:

  • Advisory Council, Financial Analysts Journal, 2003-2009
  • Advisory Board, Journal of Banking and Finance, 2003-2007
  • Advisory Board, Review of Finance (formerly European Finance Review), 1996-2005
  • Associate Editor, Journal of Banking and Finance, 1977-1979,1992-2003
  • Advisory Board, Center for Global Management and Research, George Washington University, 1996-2000
  • Advisory Board, The New Palgrave Dictionary of Money and Finance, 1989-1992
  • Selection Editor, Papers and Proceedings,  Journal of Finance, July 1986
  • Co-Editor, Journal of Financial Economics, 1974-1977
  • Associate Editor, Geneva Papers on Risk and Insurance, 1989-1996
  • Associate Editor, Journal of Financial Economics, 1977-1983
  • Associate Editor, Journal of Money, Credit and Banking, 1974-1979
  • Associate Editor, Journal of Finance, 1973-1977
  • Associate Editor, International Economic Review, 1972-1977
  • Founding Committee, Review of Financial Studies, 1986

Primary Interests

  • Financial engineering
  • Financial innovation
  • Lifecycle finance
  • Dynamics of financial institutional change
  • Risk management

Additional Topics

  • Capital markets
  • Capital structure
  • Credit risk
  • Equity-based pay
  • Financial analysis
  • Institutional investing
  • Investment banking
  • Investment management
  • Long-term investing
  • Market efficiency
  • Mutual funds
  • Real options
  • Valuation

Industries

  • Biotech and pharma
  • Banking
  • Brokerage
  • Financial services
  • Insurance industry
  • Investment banking industry
  • Retail financial services

Biographical Works

See Biographical Works

Interviews

See Interviews

Publications

See Publications

Alfred Nobel Memorial Prize in Economic Sciences

Merton received the Alfred Nobel Memorial Prize in Economic Sciences in 1997 for a new method to determine the value of derivatives.

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