Stewart Clay Myers (born 1940) is the

Robert C. Merton Robert Cox Merton (born July 31, 1944) is an American economist, Nobel Memorial Prize in Economic Sciences laureate, and professor at the MIT Sloan School of Management, known for his pioneering contributions to continuous-time finance, especia ...

Professor of

Financial Economics Financial economics is the branch of economics characterized by a "concentration on monetary activities", in which "money of one type or another is likely to appear on ''both sides'' of a trade".William F. Sharpe"Financial Economics", in Its co ...

at the

MIT Sloan School of Management The MIT Sloan School of Management (branded as MIT Sloan) is the business school of the Massachusetts Institute of Technology, a private university in Cambridge, Massachusetts. MIT Sloan offers bachelor's, master's, and doctoral degree progra ...

. He is notable for his work on capital structure and innovations in

capital budgeting Capital budgeting in corporate finance, corporate planning and accounting is an area of capital management that concerns the planning process used to determine whether an organization's long term capital investments such as new machinery, repla ...

and valuation, and has had a "remarkable influence" on both the theory and practice of

corporate finance Corporate finance is an area of finance that deals with the sources of funding, and the capital structure of businesses, the actions that managers take to increase the Value investing, value of the firm to the shareholders, and the tools and analy ...

. Myers, in fact, coined the term "

real option Real options valuation, also often termed real options analysis,Adam Borison (Stanford University)''Real Options Analysis: Where are the Emperor's Clothes?'' (ROV or ROA) applies option valuation techniques to capital budgeting decisions.Camp ...

". He is the co-author with Richard A. Brealey and

Franklin Allen Franklin Allen, (born 6 March 1956) is a British economist and academic. Since 2014, he has been professor of finance and economics, and executive director of the Brevan Howard Centre at Imperial College London. He was the Nippon Life Pro ...

of ''

Principles of Corporate Finance ''Principles of Corporate Finance'' is a reference work on the corporate finance theory edited by Richard Brealey, Stewart Myers, Franklin Allen, and Alex Edmans. The book is one of the leading texts that describes the theory and practice of c ...

'', a widely used and cited

business school A business school is a higher education institution or professional school that teaches courses leading to degrees in business administration or management. A business school may also be referred to as school of management, management school, s ...

textbook, now in its 11th edition. He is also the author of dozens of research articles.

Career

He holds an A.B. from

Williams College Williams College is a Private college, private liberal arts colleges in the United States, liberal arts college in Williamstown, Massachusetts, United States. It was established as a men's college in 1793 with funds from the estate of Ephraim ...

and a Ph.D. and

MBA A Master of Business Administration (MBA) is a professional degree focused on business administration. The core courses in an MBA program cover various areas of business administration; elective courses may allow further study in a particular a ...

from

Stanford University Leland Stanford Junior University, commonly referred to as Stanford University, is a Private university, private research university in Stanford, California, United States. It was founded in 1885 by railroad magnate Leland Stanford (the eighth ...

. He began teaching at MIT Sloan School of Management in 1966. His contributions are seen as falling into three main categories: *Work on

capital structure In corporate finance, capital structure refers to the mix of various forms of external funds, known as capital, used to finance a business. It consists of shareholders' equity, debt (borrowed funds), and preferred stock, and is detailed in the ...

, focusing on "debt overhang" and "

pecking order theory In corporate finance, the pecking order theory (or pecking order model) postulates that "firms prefer to finance their investments internally, using retained earnings, before turning to external sources of financing such as debt or equity" - i.e. ...

". *Contributions to

that complement his research on capital structure. He is notable for the

adjusted present value Adjusted present value (APV) is a valuation method introduced in 1974 by Stewart Myers. The idea is to value the project as if it were all equity financed ("unleveraged"), and to then add the present value of the tax shield of debt – and othe ...

(or APV) approach as well as for recognizing the "option-like" character of many corporate assets. *Work on estimating fair rates of return for

public utilities A public utility company (usually just utility) is an organization that maintains the infrastructure for a public service (often also providing a service using that infrastructure). Public utilities are subject to forms of public control and r ...

. Recent projects include the valuation of investments in R&D,

risk management Risk management is the identification, evaluation, and prioritization of risks, followed by the minimization, monitoring, and control of the impact or probability of those risks occurring. Risks can come from various sources (i.e, Threat (sec ...

, and the allocation of capital in diversified firms, and the theory of corporate governance. As of 2010, he was a principal of economic consulting firm The Brattle Group. He is a past president of the

American Finance Association The American Finance Association (AFA) is an academic organization whose focus is the study and promotion of knowledge of financial economics. It was formed in 1939. Its main publication, the ''Journal of Finance'', was first published in 1946. ...

, a research associate of the

National Bureau of Economic Research The National Bureau of Economic Research (NBER) is an American private nonprofit research organization "committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic co ...

, and a director of the Cambridge Endowment for Research in Finance.

Works

*Stewart C. Myers (ed) ''Modern Developments in Financial Management'', Dryden Press, 1976, *Alexander A. Robichek, Stewart C. Myers, ''Optimal financing decisions'', Prentice-Hall, 1965 * *Richard A. Brealey, Stewart C. Myers, ''Capital Investment and Valuation'', McGraw Hill Professional, 2003,

References

External links

Stewart Myers - MIT Sloan Biography

Business Week Profile

Publication list

The Contributions of Stewart Myers to the Theory and Practice of Corporate Finance
'' Journal of Applied Corporate Finance'' {{DEFAULTSORT:Myers, Stewart Living people Financial economists American finance and investment writers American textbook writers American male non-fiction writers Williams College alumni Corporate finance theorists Real options MIT Sloan School of Management faculty Presidents of the American Finance Association Year of birth missing (living people)