Much of the world continues to face economic challenges, and financial innovation will be “essential” to solving them, according to Nobel laureate and MIT Sloane School of Management professor Robert Merton. That even extends to one of the things we’ll all face one day: retirement. Merton has studied extensively how innovation and retirement planning intersect. We sat down with him recently, and he told us about the role futures markets play:
“In the case of retirement, as we see that people want to be more sure that they’ll have income for the rest of thier life, someone has to bear efficiently that longevity risk, the interest rate risk, the inflation risk, all of these. And innovations come along to find a better and better way of doing it.”
Merton and fellow Nobel laureate Myron Scholes give their take on Dodd-Frank.