Shameless plug…

During class today, I referred to a journal article that I published early in my academic career that Professor Robert C. Merton cites in his Nobel Prize lecture (Merton shared the Nobel Prize in economics in 1997 with Myron Scholes “for a new method to determine the value of derivatives”).

Here’s the citation (and link) to Merton’s lecture:

Merton, Robert C., 1998, Applications of Option-Pricing Theory: Twenty-Five Years Later, The American Economic Review, Vol. 88, No. 3 (Jun. 1998), pp. 323-349.

See page 337, footnote 11 of Merton’s paper for the reference to Neil A. Doherty and James R. Garven (1986)… (Doherty and I “pioneered” the application of a somewhat modified version of the BSM model to insurance pricing; thus, Merton’s reference to our Journal of Finance paper in his Nobel Prize lecture).

Here is the APA-compliant listing for the above-referenced Doherty-Garven:

Doherty, Neil A. and James R. Garven. 1986. “Price Regulation in PropertyLiability Insurance: A Contingent Claims Approach.” Journal of Finance, 41 (5):1031-1050.

The 17 equations that changed the course of history (spoiler alert: we use 4 of these equations in Finance 4366!)

I especially like the fact that Ian Stewart includes the famous Black-Scholes equation (equation #17) on his list of the 17 equations that changed the course of history; Equations (2), (3), (7), and (17) play particularly important roles in Finance 4366!

From Ian Stewart’s book, these 17 math equations changed the course of human history.