From June 5 to 6, Robert C. Merton, recipient of the 1997 Nobel Memorial Prize in Economic Sciences, member of the U.S. National Academy of Sciences, and Senior Professor at the Massachusetts Institute of Technology (MIT), visited Northwestern Polytechnical University (NPU) and engaged in extensive exchanges with faculty and students, exploring the enduring appeal of economic and financial modeling.
At the International Conference Center, NPU Vice President Kong Jie met with Professor Merton. On behalf of the University, Kong extended a warm welcome and introduced NPU’s history, current development, and distinctive disciplinary strengths. He noted that since the launch of “the Double First-Class Initiative”, NPU has achieved remarkable progress, with its engineering disciplines ranking among the top 0.01% globally and related disciplines rising rapidly in international rankings. He expressed the hope that Professor Merton would offer guidance and support for the development of the NPU’s management disciplines and provide valuable insights into interdisciplinary development, talent cultivation, and scientific research.
Professor Merton expressed his deep impression on NPU’s rapid achievements across various fields and looked forward to deeper exchanges and cooperation with the NPU’s faculty and students. He also wished NPU continued success in its pursuit of becoming a world-class university and making further breakthroughs in engineering science and technology.
On the morning of June 6, Professor Merton delivered a keynote lecture titled A Lifetime of Modeling: Lessons in Economic and Financial Modeling Reflecting on the Past and Looking to the Future at the Ao’xiang Student Center, attracting an audience of more than 700 faculty members and students. During the lecture, Professor Merton emphasized that although economic and financial systems are highly complex and constantly evolving, modeling enables researchers to abstract and simplify these systems in a meaningful way. Such models help identify systemic risks, support asset pricing, and facilitate more informed forecasting and decision-making. Using the renowned Black–Scholes–Merton option pricing model as an example, he vividly illustrated the transformative role of modeling in understanding and managing financial systems.
During the Q&A session, students enthusiastically raised questions on topics ranging from the future of globalization and its challenges to the influence of educational background on career development. Professor Merton responded thoughtfully and patiently to each inquiry.
The face-to-face exchanges provided students with valuable exposure to cutting-edge theories and practical applications of financial risk modeling, while also inspiring them to apply scientific frameworks to the analysis of complex real-world problems.
During his visit, Professor Merton was also invited to the School of Management, where he met with more than 30 faculty representatives and student representatives from the “Zhujian Class”(the Sword-forging Elite Programme). Focusing on topics such as artificial intelligence and finance, interdisciplinary research, and pathways for young scholars’ development, Professor Merton engaged in in-depth discussions with participants. Faculty members and students alike noted that the opportunity to interact closely with a world-renowned scholar not only deepened their understanding of frontier developments and fundamental principles in finance, but also offered valuable guidance on formulating research questions, selecting research directions, and building robust knowledge systems.
After a series of interaction and communication, students also gain valuable refelction
Xiao Yang, School of Management
My greatest takeaway from this event is that truly valuable knowledge never remains confined to textbooks. Professor Merton’s responses were rigorous, open-minded, and sincere, reflecting both profound scholarly expertise and genuine concern for real-world issues. The discussion deepened my understanding of financial engineering and risk management while reminding me of the importance of using professional knowledge to analyze the world and serve society.
Wang Xinyu, School of Mathematics and Statistics
What impressed me most was Professor Merton’s account of his transition from mathematics to economics. When others considered the decision “crazy,” he chose to follow the questions that continued to occupy his mind in the early morning and late at night. Pursuing one’s genuine intellectual interests, I realized, can be far more powerful than merely persevering for the sake of persistence.
Zhang Yushi, School of Public Policy and Administration
Having the opportunity to attend Professor Merton’s lecture was an inspiring intellectual experience. Drawing on decades of research in financial modeling, he provided insightful analyses of option pricing, decision-making under uncertainty, and the logic of AI-driven modeling, while skillfully bridging disciplinary boundaries. As a law student, I gained a broader interdisciplinary perspective and discovered new ways of approaching the study of financial law.
Wang Yulu, School of Foreign Studies
Professor Merton highlighted that only by mastering disciplinary fundamentals, accumulating practical experience, and building models grounded in objective reality can we effectively leverage artificial intelligence to address real-world challenges. His insights encouraged me to strengthen my academic foundation, focus on personal capability development, maintain independent thinking, and adopt a rational perspective on AI technologies.
Xu Binhui, School of Marxism
As a Nobel laureate, Professor Merton demonstrated extraordinary expertise in financial modeling. Throughout the lecture, he transformed abstract theories into vivid practical examples, revealing both a precise understanding of financial realities and a rigorous, evidence-based academic spirit that I found deeply inspiring.
David Yang, International College
Drawing on his distinguished career, Professor Merton offered a profound perspective on the evolution of economic and financial modeling. One insight particularly resonated with me: the purpose of models is not to predict the future with perfect accuracy, but rather to help us better understand complex financial and economic systems so that we can make wiser decisions under uncertainty. This perspective fundamentally reshaped my understanding of financial models. The lecture also reinforced my belief in lifelong learning—continuous adaptation and growth remain essential in an ever-changing financial world.
Background Information
Robert C. Merton is a member of the U.S. National Academy of Sciences, Senior Professor at the Massachusetts Institute of Technology, and recipient of the 1997 Nobel Memorial Prize in Economic Sciences. Widely recognized as one of the founding figures of modern financial economics, he studied under Nobel laureate Paul A. Samuelson and played a pivotal role in refining and extending the Black–Scholes framework, helping establish the Black–Scholes–Merton option pricing theory, which became a cornerstone of modern derivatives pricing.Professor Merton pioneered the application of mathematical option-pricing methodologies to a broad range of financial practices, providing powerful quantitative tools for modern risk management. His influential works, including Continuous-Time Finance, have become standard references in business schools worldwide. Throughout his career, Professor Merton has been deeply committed to advancing collaboration among academia, industry, and research institutions. He has served as President of the American Finance Association and as a Managing Director at JPMorgan Chase, actively promoting the practical application of financial engineering theories. His contributions have earned him exceptional prestige in both the international academic and financial communities.
(Source: Office of International Cooperation
Text: Quan Mentianzi; Shi Wanwen; Yang Hongli
Photos: Lu Di; Liu Yezhao; Zhai Renjie
Initial Review: Shi Wanwen
Second Review : Yang Hongli
Final Review: Li Ziwei
Translators: Yang Runze; Mei Leyun)
