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 Études Commerciales (France) 1995
  • Doctor of Economic Science, honoris causa, University of Lausanne (Switzerland) 1996
  • Doctoris Honoris Causa, University Paris-Dauphine (France) 1997
  • Doctor of Management Science, honoris causa, National Sun Yat-sen University (Taiwan) 1998
  • Doctor of Science, honoris causa, Athens University of Economics and Business (Greece) 2003
  • Doctor Honoris Causa, Universidad Nacional Mayor de San Marcos (Lima, Perú) 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 Católica 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 (México) 2016
  • Doctor Honoris Causa, Universidad Michoacana de San Nicolás de Hidalgo (Morelia, México) 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, Italy) 2018
  • Honorary Professor, University of International Business and Economics (Beijing, China) 2019

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

Current

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

Past:

  • Member, Board of Directors, Nova Fund, 1980-1988
  • Member, Board of Trustees, ABT Growth and Income Trust, 982-1988
  • Member, Board of Directors, ABT Utility Income Fund, 1982-1988
  • Member, Board of Directors, ABT Investment Series, 1983-1988
  • Member, Board of Directors, Travelers Investment Management Company, 1987-1991
  • Senior Advisor, Salomon Inc., 1988-1992
  • Member, Board of Trustees, College Retirement Equities Fund, 1988-1996
  • Co-Founder, Management Committee, Long-Term Capital Management, L.P., 1993-1999
  • 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-
  • Senior Advisor, J.P. Morgan & Company, Inc., 1999-2000
  • Member, The Honorable Order of Kentucky Colonels, Commonwealth of Kentucky, 1999-
  • Member, Advisory Board, eCredit.com, 2000-2002
  • FMA Fellow, Financial Management Association, 2000-
  • Fellow, Society of Fellows, American Finance Association, 2000-
  • Managing Director, J.P. Morgan Chase, 2001
  • Member, Advisory Board, nuServe, 2001- 2004
  • Member, Advisory Board, AlphaSimplex Group, Cambridge, MA, 2001-2007
  • Member, Board of Directors, MF Risk, Inc., 2001-2009
  • Member, Board of Directors, Integrated Finance Limited, 2002-2007
  • Co-Founder, Chief Science Officer, Integrated Finance Limited, 2002-2007
  • Member, Board of Directors, Vical Inc., 2002-2019
  • Member, Honorary Board, The International Raoul Wallenberg Foundation, 2003-
  • Member, Honorary Board, Angelo Roncalli International Committee, 2003-
  • Member, Board of Directors, Dimensional Funds, 2003-2009
  • Member, Board of Directors, Peninsula Banking Group, 2003-2010
  • Member, Board of Directors, Community First Financial Group, 2003-2010
  • Chief Science Officer, Trinsum Group, 2007-2008
  • Member, Board of Directors, Trinsum Group, 2007-2008
  • Senior Advisor, Platinum Grove Asset Management, 2008
  • Member, MIT Sloan Finance Group Advisory Board, 2008-2010
  • Member, International Advisory Board, Middle East Science Fund, Amman, Jordan, 2008-2013
  • Co-Editor, Annual Review of Financial Economics, 2009-2021
  • Member, The Committee on Yen Risk-free-rate Model Estimation, 2011
  • Member, Advisory Board, Office of Financial Research, US Treasury, 2011-2014
  • Member, Panmure House Advisory Board, Edinburgh Business School, Heriot-Watt University, 2012-2014
  • Distinguished Fellow, Center for Financial Studies, Goethe University, Frankfurt, 2014
  • Member, American Association for Cancer Research, 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, 1982-1984; 1987-1988
  • 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:

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

Past:

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

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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