Robert Merton Sloan-to-Harvard departure

Lester Thurow's "extinct volcanoes" line, used as the punchline of Tom's "it's not what you say, it's how you say it" lesson. Not a materials case; a teaching-craft anecdote that touches on the 2008-era derivatives world tangentially.

I still love Lester's line. A couple years later he was at the Cambridge Marriott, talking to people in industry, lamenting that we lose some of our top faculty at Sloan School to other business schools. We all knew he was sort of talking about Robert Merton. Merton worked with Black and Scholes on derivatives. Those guys worked out the math for derivatives trading. Robert Merton left MIT and went up to Harvard Business School. He won the Nobel Prize for what he did with Black-Scholes. Lester never mentioned Merton by name, but he said: fortunately, "they tend to hire our extinct volcanoes."