Myron S. Scholes
Nobel Laureate in Economic Sciences 1997
Professor Emeritus of Finance, Graduate Business School, Stanford University, USA
Co-reason for the prize:
for developing a new method to determine the value of derivatives
Main Topics:
- Financial economics and taxation, fiscal policies effects on decision making, taxation and company auditing dynamics;
- Financial innovation;
- Risk management and financial markets;
- Stock options pricing and company liabilities
Professional Profile:
Professor Scholes, the Frank E. Buck Professor, Emeritus at the Stanford University Graduate School of Business, was awarded, together with Professor Robert Merton, the Nobel Prize “for developing a new method to determine the value of derivatives”. The formula was developed by Professor Scholes with the late Professor Fischer Black and first published in the Journal of Political Economy in May 1973. The formula was further developed by Professor Merton who showed its broad applicability. The Black-Scholes options pricing model has become the benchmark formula for the valuation of stock options. Today thousands of investors and traders use the formula every day to value stock options in markets around the world.
He was on the faculty of the Stanford Graduate School of Business from 1983 to 1996 and was also a Professor of Law at the Stanford Law School. Prior to that, he was a Faculty Member at MIT and at the University of Chicago.
In 1992, while still at Stanford, Professor Scholes was named a Managing Director of Salomon Brothers and then Co-head of its fixed-income derivative sales and trading department. Professor Scholes joined with several colleagues, many from Salomon Brothers, to become a Principal and Co-founder of a firm called Long-Term Capital Management
By applying financial technology to practice, Professor Scholes has achieved a better understanding of the evolution of financial institutions and markets, and the forces shaping this evolution on a global basis. The research papers in the last few years have focused on the interaction and evolution of markets and financial institutions.
Professor Scholes received honorary doctorate degrees from: University of Paris-Dauphine, McMaster University, and Katholieke Universiteit Leuven.
Education:
- B.A., McMaster University (Ontario), 1961
- M.B.A. in Business Administration, University of Chicago, 1964
- Ph.D., University of Chicago, 1969
Selected Works:
- M. Scholes, M. A. Wolfson, M. M. Erickson, E. L. Maydew, Terrence J. Shevlin, Taxes and Business Strategy: A Planning Approach (3rd edition), Prentice Hall, 2004 (1st edition 1992)
- M. S. Scholes, The Economics of Hedging and Spreading in Futures Markets, Journal of Futures Research, July 1981
- M. S. Scholes, Executive Compensation, Taxes, and Incentives, Financial Economics: Essays in Honor of Paul Cootner, Prentice Hall, 1981
- M. S. Scholes, Optimal Liquidation of Assets in the Presence of Personal Taxes: Implications for Asset Pricing, Journal of Finance, May 1980
- M. S. Scholes, Dividends and Taxes, Journal of Financial Economics, December 1978
- M. S. Scholes, The Effects of Dividend Yield and Dividend Policy on Common Stock Prices and Returns, Journal of Financial Economics, May 1974
Associated Partner
