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Remembering Mert
Pacific-Basin Finance Journal 10 (2002) 353 www.elsevier.com/locate/econbase
Preface
Remembering Mert This special memorial issue of the Pacific Basin Finance Journal honors and rejoices in the life of Merton Miller, the father of modern finance. For those who knew him well, he was the consummate scholar, the defender of sound policy, the quasher of muddled thinking, the gifted humorist, and the cultured humanist. As recounted here by Andy Chen, Mert’s multitudinous skills even included the expert preparation of Chinese dishes at least as complex as the index options traded in Chicago. (But unlike the transparency Mert constantly advocated for index options, his lemon chicken recipe was a lifelong secret.) Indefatigable travel with his wife Katherine included frequent appearances at the annual Pacific Basin conferences. His nine keynote addresses on those occasions, which contain numerous typical Mert gems, are reviewed appreciatively by John McConnell in this volume. In fine tribute to Mert, many good papers were submitted for this special issue. In selecting those to be published, I tried to imagine which papers Mert would have favored. All those included here would have been highly regarded by him, I think, because they are clearly written, rigorous, empirical, and on topics near and dear to his own research interests. Two papers here are about dividends, one of Mert’s favorite subjects. Brown et al. look at analysts’ dividend forecasts while Kato et al. investigate corporate dividend policy. Two other papers are about derivatives, his favorite class of financial assets; these are on warrant pricing (Huang and Chen) and on index futures (Tang and Lui). Finally, Karolyi investigates international financial flows and investor behavior during a time of crisis. Mert would have been intrigued by this paper too because after news-grabbing financial calamities, he often spoke out publicly to defend free markets and free capital mobility from the rapacious reactions of government. To me personally as well as to many, many others, Mert was an inspiration, a trusted advisor and a dear friend. He was one of a kind and cannot be replaced. But I would like to think that somewhere, he is smiling and nodding his famous indication of approval at the traditions and values being perpetuated in his memory on the following pages. Richard Roll John E. Anderson School of Management, University of California at Los Angeles, 110 Westwood Plaza, 90095-1481, Los Angeles, CA, USA E-mail address: [email protected] Tel.: +1-310-825-6118; fax: +1-310-206-8404 0927-538X/02/$ - see front matter D 2002 Elsevier Science B.V. All rights reserved. PII: S 0 9 2 7 - 5 3 8 X ( 0 2 ) 0 0 0 6 2 - 8
Preface
Remembering Mert This special memorial issue of the Pacific Basin Finance Journal honors and rejoices in the life of Merton Miller, the father of modern finance. For those who knew him well, he was the consummate scholar, the defender of sound policy, the quasher of muddled thinking, the gifted humorist, and the cultured humanist. As recounted here by Andy Chen, Mert’s multitudinous skills even included the expert preparation of Chinese dishes at least as complex as the index options traded in Chicago. (But unlike the transparency Mert constantly advocated for index options, his lemon chicken recipe was a lifelong secret.) Indefatigable travel with his wife Katherine included frequent appearances at the annual Pacific Basin conferences. His nine keynote addresses on those occasions, which contain numerous typical Mert gems, are reviewed appreciatively by John McConnell in this volume. In fine tribute to Mert, many good papers were submitted for this special issue. In selecting those to be published, I tried to imagine which papers Mert would have favored. All those included here would have been highly regarded by him, I think, because they are clearly written, rigorous, empirical, and on topics near and dear to his own research interests. Two papers here are about dividends, one of Mert’s favorite subjects. Brown et al. look at analysts’ dividend forecasts while Kato et al. investigate corporate dividend policy. Two other papers are about derivatives, his favorite class of financial assets; these are on warrant pricing (Huang and Chen) and on index futures (Tang and Lui). Finally, Karolyi investigates international financial flows and investor behavior during a time of crisis. Mert would have been intrigued by this paper too because after news-grabbing financial calamities, he often spoke out publicly to defend free markets and free capital mobility from the rapacious reactions of government. To me personally as well as to many, many others, Mert was an inspiration, a trusted advisor and a dear friend. He was one of a kind and cannot be replaced. But I would like to think that somewhere, he is smiling and nodding his famous indication of approval at the traditions and values being perpetuated in his memory on the following pages. Richard Roll John E. Anderson School of Management, University of California at Los Angeles, 110 Westwood Plaza, 90095-1481, Los Angeles, CA, USA E-mail address: [email protected] Tel.: +1-310-825-6118; fax: +1-310-206-8404 0927-538X/02/$ - see front matter D 2002 Elsevier Science B.V. All rights reserved. PII: S 0 9 2 7 - 5 3 8 X ( 0 2 ) 0 0 0 6 2 - 8