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Born on this day
Georges Dufrénoy
Georges Dufrénoy was a painter.
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Important personalitiesBack

Franco Modigliani18.6.1918

Wikipedia (11 Jun 2013, 09:57)

Franco Modigliani (June 18, 1918 – September 25, 2003) wasan Italian economist naturalized American, a professor atthe MIT Sloan School of Management and MIT Department ofEconomics who won the Nobel Memorial Prize in Economics in 1985.

Bornin Rome, Modigliani left Italy in 1939 because ofhis Jewish origin and antifascist views. He first went to Paris withthe family of his then-girlfriend, Serena, whom he married in 1939, and then tothe United States. From 1942 to 1944, he taught at ColumbiaUniversity and Bard College as an instructor in economics andstatistics. In 1944, he obtained his D. Soc. Sci. from the NewSchool for Social Research working under Jacob Marschak. In 1946, hebecame a naturalized citizen of the United States, and in 1948,he joined the University of Illinois at Urbana-Champaign faculty.

When hewas a professor at the Graduate School of IndustrialAdministration of Carnegie Mellon University in the 1950s andearly 1960s, Modigliani made two path-breaking contributions to economicscience:

Along with Merton Miller, heformulated the important Modigliani–Miller theorem in corporatefinance. This theorem demonstrated that under certain assumptions, the value ofa firm is not affected by whether it is financed by equity (selling shares) ordebt (borrowing money).He was also the originator of the life-cyclehypothesis, which attempts to explain the level of saving in theeconomy. Modigliani proposed that consumers would aim for a stable level ofconsumption throughout their lifetime, for example by saving during theirworking years and spending during their retirement.

In 1962,he joined the faculty at MIT, achieving distinction as an InstituteProfessor, where he stayed until his death. In 1985 he received MIT's James R. KillianFaculty Achievement Award.

Modiglianialso co-authored the textbooks, "Foundations of Financial Markets andInstitutions" and "Capital Markets: Institutions andInstruments" with Frank J. Fabozzi of Yale School ofManagement.

In the1990s he teamed up with Francis Vitagliano to work on a new credit card, and healso helped to oppose changes to a patent law that would be harmful toinventors.

Modiglianiwas a trustee of the Economists for Peace and Security.

Acollection of Modigliani's papers is housed at the Rubenstein Library at DukeUniversity.

For manyyears, he lived in Belmont, Massachusetts; he died in Cambridge,Massachusetts.


   
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