Stephen Ross (economist)
|Born||February 3, 1944
|Died||March 3, 2017(aged 73)|
|Contributions||Arbitrage pricing theory
Binomial options pricing model
|Awards||Smith Breeden Prize (2006)
Deutsche Bank Prize (2015)
Stephen Alan "Steve" Ross (February 3, 1944 – March 3, 2017)  was the inaugural Franco Modigliani Professor of Financial Economics at the MIT Sloan School of Management. He is known for initiating several important theories and models in financial economics. He is a widely published author in finance and economics, and is coauthor of one of the best-selling Corporate Finance texts.
He received his B.S. with honors from Caltech in 1965 where he majored in physics, and his Ph.D. in economics from Harvard in 1970, and has taught at the University of Pennsylvania, Yale School of Management, and MIT. At Yale he was the Sterling Professor of Economics and Finance .
Ross is best known for the development of the arbitrage pricing theory (mid-1970s) as well as for his role in developing the binomial options pricing model (1979; also known as the Cox–Ross–Rubinstein model). He was an initiator of the fundamental financial concept of risk-neutral pricing. In 1985 he contributed to the creation of the Cox–Ingersoll–Ross model for interest rate dynamics. Such theories have become an important part of the paradigm known as neoclassical finance.
He gave the inaugural lecture of the Princeton Lectures in Finance, sponsored by the Bendheim Center for Finance of Princeton University, in 2001. It became a book in 2004, presenting neoclassical finance and defending it, including such notions as the efficiency and rationality of markets, against its critics, especially those who belong to the behavioral finance tradition.
- Ross, Stephen A. "The economic theory of agency: The principal's problem." The American Economic Review 63.2 (1973): 134-139.
- Ross, Stephen A. Neoclassical finance. Princeton University Press, 2004.
- U.S. Economist Ross Wins Deutsche Prize for Pricing Models, The New York Times. Retrieved March 3, 2015.
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