MODIGLIANI, FRANCO (1918–2003), economist and Nobel Prize laureate. Modigliani was born in Rome. After earning a law degree at the University of Rome, he escaped the Fascist regime in Italy and moved to the United States in 1939. In New York he studied at the New School for Social Research, obtaining his Ph.D. in social sciences in 1944. Modigliani taught at the New School from 1944 to 1949 and was a research consultant to the Cowles Commission at the University of Chicago from 1949 to 1952. He was a professor at Carnegie Institute of Technology from 1952 to 1960 and at Northwestern University from 1960 to 1962. He was on the faculty of the Massachusetts Institute of Technology from 1962, becoming professor emeritus in 1988. He served as president of the American Economic Association in 1976.
Modigliani's research work focused on the analysis of household savings, wherein he determined that people save towards retirement rather than amass money to be left as inheritance for the next generation, and on the different types of national pension programs and their effects. He also was highly influential in the area of corporate finance by directing attention to the fact that future earnings of a company serve to determine stock market values. The Nobel Prize in economic science for 1985 was awarded to him for "his pioneering analyses of saving and financial markets," for work that he published in the second half of the 1950s.
Modigliani's autobiography is entitled Adventures of an Economist (2001). His other publications include The Debate over Stabilization Policy (1986); Capital Markets (with F. Fabozzi, 1992); Foundations of Financial Markets and Institutions (with F. Fabozzi and M. Ferri, 1994); and Rethinking Pension Reform (with A. Muralidhar, 2004).